Solutions to improve business strategy at akira education co , ltd a change in customer approach

FOREIGN TRADE UNIVERSITY FACULTY OF BUSINESS ADMINISTRATION ---***--- GRADUATION THESIS Major: International Business Management SOLUTIONS TO IMPROVE BUSINESS STRATEGY AT AKIRA EDUCATI

FOREIGN TRADE UNIVERSITY FACULTY OF BUSINESS ADMINISTRATION

-*** -

GRADUATION THESIS Major: International Business Management

SOLUTIONS TO IMPROVE BUSINESS STRATEGY AT AKIRA EDUCATION CO., LTD: A CHANGE IN

CUSTOMER APPROACH

Student name: Vu Thu Trang Student ID: 1716280061 Class: English 01 – Advanced Program Batch: 56

Supervisor: Assoc Prof Dr Cao Dinh Kien

Hanoi, July 2021

CHAPTER 2: ANALYSIS OF CURRENT BUSINESS STRATEGY AT AKIRA

II

2.4 Analysis of the current situation of business strategy of Akira Co., Ltd. 40

2.5 Evaluation of current business strategy of Akira Co., Ltd 50

CHAPTER 3: SOLUTIONS TO IMPROVE BUSINESS STRATEGY OF AKIRA

IV

LIST OF TABLES, CHARTS AND FIGURES

- Figure 1.1 The basic model of strategic management 15

- Figure 1.2 Delta Project model 17

- Figure 1.3 Strategy Map 19

- Figure 2.1 The organizational structure of the company 30

- Figure 2.2 Current Delta project model of Akira company 48

- Table 2.1: Business results of Akira Co., Ltd in the period of 2018 – 2020 32

- Table 2.2: Current strategic map of Akira Co., Ltd 49

- Chart 2.1: Definition Mission and Vision of Company 40

- Chapter 2.2: Contents of strategic analysis 43

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INTRODUCTION

1 The urgency of the topic

Vietnam's economy is integrating into the world economy The business environment of enterprises is expanding, but the competition is becoming more and more fierce This not only creates business opportunities, but also contains potential risks that threaten the development of enterprises Therefore, it is not enough for an enterprise to survive, but it needs continuous development and continuous development The problem of formulating business strategy for the company has become more important and urgent than ever, because it determines the survival and success of the company and provides vitality and flexibility for the company Have the ability to occupy and occupy domestic and foreign markets

At present, Vietnamese enterprises, regardless of economic sector, are facing competitive pressure from domestic and foreign enterprises, substitutes, suppliers and customers Therefore, the strategic planning of enterprises is not only very important, but also meaningful to the existence and survival of enterprises in the market Because it enables enterprises to take the initiative to propose business solutions to cope with risks or seize opportunities to compete and win Modern strategic management helps enterprises to pay more attention to environmental analysis and planning the importance of strategies related to environmental conditions

Vietnam is one of the countries that attach great importance to education Vietnam spent a total of $20 billion on education in 2018 The online education sector, with revenue of about $200 million, currently accounts for only 1% of the total market revenue

In 2019, Vietnam was in the top 10 fastest growing global online education markets with a compound annual growth rate of 44.3% According to Ken Research, Vietnam's online education market can achieve a growth rate of about 20.2% in the period 2019-2023 In fact, during the outbreak of the Covid-19, the trend of digital transformation is being accelerated by many schools having to

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close due to social distancing According to a recent report by Do Ventures, EdTech is currently the 3rd most invested field in Vietnam in the past 8 years in the technology sector The total venture capital investment in the EdTech sector in Vietnam is 103 million USD, second only to the payments sector ($462 million) and retail ($416 million) However, the field of EdTech and educational digital transformation in general in our country is still just beginning Therefore, Vietnam

is an attractive market for investors, which creates a fierce competition environment among companies in the industry Companies that want to stand firmly in the market and keep their market share need to build a suitable business strategy for their business, Akira Co., Ltd is no exception

Akira Co., Ltd is an enterprise engaged in toy production and retail, publishing books, newspapers, magazines and periodicals, so the research proposes some solutions to support the implementation of the proposed strategy

As a result, the writer chose the topic “Solutions to improve business strategy at

Akira Education Co., Ltd : A change in customer approach” as the graduation

report

2 Research Objectives

- Explore the theories relating to strategic planning in companies

- Analyze the changes of the Company's business strategy from 2019 to

⮚ Temporal scope: Secondary data of the study were collected by the author

in the range from 2018 to 2020

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4 Research methodology

4.1 The method of data collection

Collecting secondary data: collecting available and relevant documents from departments at Akira Education Co., Ltd such as: Sales Department, Marketing Department, Accounting and Finance Department Moreover, other relevant information is collected from books, newspapers, and the internet

Based on the research and collected data, this study use excel software to conduct statistics, process the data and then describe it with tables and charts to address research purposes

4.2 Methods of data analysis

Comparative method

Comparison is a commonly used method to evaluate results, determine the position and trend of fluctuations of analytical indicators In order to apply the comparison method, it is necessary to ensure that the conditions of the criteria are comparable, there must be at least 2 quantities or 2 indicators Indicators or quantities must agree on the content and method of calculation, in terms of time and units of measurement Comparative criteria, depending on the purpose of analysis, but mainly use the following criteria:

Compare the actual achieved with the plan, the norm to evaluate the performance of the target, compare the actual data of this period with one or more previous period's reality to determine the trend or growth rate

Comparative technique: absolute comparison is the determination of the difference between the value, between the indicator of the analysis period and the value of the base period, showing the change in the absolute number of the object Relative comparison is the determination of the percentage increase or decrease in the actual period compared to the base period or the proportion of a phenomenon

in the overall scale, showing the growth rate or structure, prevalence of the phenomenon Relative, absolute and proportion comparison methods to analyze and evaluate the criteria of enterprises over the years and in the same year

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Form, chart method

In economic analysis, one must use analytical forms and diagrams to visually evaluate the analytical data The analysis form is generally set up in columns to record indicators and data for analysis The forms for analysis often reflect the comparative relationship between related economic indicators: comparison between the number of implementations and the number of plans, compared with the same period last year or compare the individual target with the overall target The number of rows and columns depends on the purpose of the analysis Depending on the content of the analysis, the analysis table has different names and different units The diagrams and charts are used in the analysis to reflect the increase and decrease of economic indicators in different time periods

5 The structure of the study

In addition to the Introduction, Conclusion and References, this study is divided into three main chapters as follows:

Chapter 1: Theoretical Basis on Business Strategy

Chapter 2: Analysis of Current Business Strategy at Akira Co., Ltd

Chapter 3: Solutions to Improve Business Strategy of Akira Co., Ltd

Eden and Ackerman (1998) believe that the strategy is "a coherent set of individual discrete actions, supported by a target system, and supported by important self-sustaining or opinion driving forces in an organization as a portfolio."

Mintzberg et al (1998) cited by Beckman and Rosenfield (2008) captures most of the key issues that organizations need to pay attention to when formulating and implementing strategies Strategies depend on the basic building blocks for attack, defense, and mobility The formulation of strategies depends on finding and executing new combinations of these blocks In all times, technology and social organization have limited integration After a period of time, these restrictions seem inevitable and therefore natural Strategists no longer question the wisdom they have acquired, and limit themselves to the variants of accepted themes Therefore, great commanders like Napoleon must update their strategies by recognizing and introducing new combinations

Ackerman's set of piecemeal actions can be regarded as "competitive actions and business methods" by Thompson, Strickland and Gamble (2007)

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Another common factor in these authors' definition of strategy is that its focus is

to achieve the organization's target performance level sustainably

1.1.2 Concept of strategic management

Strategic management is a broader term than strategy It is a process in which senior managers analyze the organizational environment to formulate strategies, and formulate strategic implementation and control plans Strategic management is a collection of activities such as strategic analysis, strategic formulation, strategic implementation and strategic monitoring It systematically organizes resources according to the vision, mission and strategy of the whole organization Strategic management is not about predicting the future, but about preparing the organization by knowing the right steps to implement the strategic plan Initially, strategic management was part of strategic planning, but now strategic planning is the main tool of strategic planning

Combining strategic planning and strategic management, planning and management in a unified process (Porth, 2002), strategic management has become one of the most prominent areas of management It is a comprehensive set of management actions to help managers keep the organization in line with the environment and point out the right development path (Jones et al 1981) Strategic management in organizations focuses on creating and maintaining competitive advantages (Bowman et al., 2002) It is a process and a road to guide the actions

of the whole organization (Dess et al., 2007) It is a set of actions, including organizational analysis, decision-making and actions to create and maintain competitive advantage

These competitive advantages support an organization to identify opportunities and reduce environmental threats More generally, therefore, strategic management is a comprehensive, ongoing process involving defining the organization's tasks and objectives in both internal and external environments

1.2 Business strategy

1.2.1 Concept of business strategy

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Business strategy has been a subject of research since at least the beginning

of the 20th century to find answers to the question of why some firms are superior

to others in the long run (Barney & Arikan 2001) Although the search for the reasons and foundations of sustainable competitive advantage began more than

100 years ago, the research changed greatly in the 1960s, when Selznick introduced 14 ideas about the "internal state" and "external expectation" of analytical institutions into the later famous swot analysis (Kong, 2008) In addition, Chandler proposed the concept of long-term coordination strategy as the basis of competitive advantage, which requires the direction and structure of the company (Chandler, 1962)

In 1971, Andrews promoted this area by defining strategy as the balance of actions and choices between the internal capabilities of the organization and the external environment (Kong, 2008, p 283) On the basis of Selznick, Weihrich (1982) developed the SWOT analysis framework from the perspective of internal and external analysis Although the early SWOT framework is still in use today, the strategic theory has been further developed on this basis, which has led to the division of scientific research (Kong, 2008) Hofer and Schendler (1978) identified three main areas of disagreement among researchers at the time

The first disagreement in this area involves the scope of the concept of business strategy Another inconsistency is what components, if any, can be found

in the strategy, and whether the process of formulating the strategy belongs to the strategic field (Hofer & Schendel, 1978) In 1980, Braque contributed to a better understanding and integration of the field of strategic research by summarizing the commonalities between the main authors and discovering two streams The first definition of business strategy involves environmental or situational analysis to determine the company's position in the market, while the second definition mainly considers the company's resources and their proper use (Bracker, 1980) The first approach, which focuses on opportunities and threats, is later called industrial organization, and focuses on the environmental factors of enterprises as the main

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determinants of organizational performance A second research stream that evolved from the SWOT approach argues that organizational resources and capabilities are the root cause of success This direction was called the Resource-Based Perspective (RBV) in the 1980s (Kong, 2008)

1.2.2 The role of business strategy

Thompson, Strickland and Gamble (2007) identified two main reasons why strategy is so important in business organizations The first important aspect of the strategy is that management needs to actively plan how the organization's business will proceed They further confirm that a clear, well-thought-out strategy is a management prescription for doing business, a roadmap for competitive advantage, a game plan for pleasing customers and improving financial performance Second, they say, companies that focus on strategy are more likely

to be better performers than those whose management sees strategy as secondary and prioritized elsewhere Effective strategy formulation and implementation have

a significant positive impact on income growth, profit and return on investment Dyson et al (2007) tend to call the strategic management process the strategic development process They recognize that the strategic development process includes a management process that informs, shapes and supports the strategic decisions facing the organization Their preference for the term strategic development process is based on their emphasis on three key issues First of all, these authors believe that the formulation and implementation of strategy is an inseparable and continuous business of the organization; Therefore, the concept of sustainable development is the core of their thoughts The second reason for their approach is that the widely used term "strategic planning" has become worthless because it is linked to the creation of definite, one-off five-year plans and ten-year plans, which shows that thinking about the future is rigid Their third argument is that "strategic management" is too loose a term to describe their approach characterized by the need to emphasize reflective engagement and analytical issues

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Although they slightly deviate from the traditional strategic management mode, they share the same view with Thompson, Strickland and Gamble (2007), that is, strategy formulation and implementation are the core governance functions; Implementing a strategy of excellence is the best test of management experience and the surest secret to making an enterprise achieve excellence The second perspective is how the management team of the organization plans the direction of the company, how to formulate competitive and effective strategic actions and business methods, and how to pursue what needs to be done Create good strategy implementation and excellent daily performance internally, which determines the ultimate success or failure of the organization

The performance of an organization depends on the corporate strategy adopted and implemented (Kotey and Meredith, 1997) The findings of many researchers also confirm the relationship between firm strategy and organizational performance (Covin & Slevin 1986; Delmar Davidsson & Gartner 2003; Yasuda 2005) Miller & Friesen (1983) argues that the best performing organizations are those whose strategy tends to start through innovation in areas such as product development and customer service, rather than imitating what other organizations

in the market have been doing Zeithmal and Fry (1984) also identified performance indicators such as improvements to existing products to meet changing customer tastes, needs and requirements, product development with a focus on product quality, market growth and subsequent financial performance A study by Vickery, Droge, and Markeland (1993) also found that high-performance companies implement new manufacturing technologies that emphasize cost-effectiveness, labor productivity, and industry competitiveness

1.2.3 Classification of business strategy

The business strategy of an enterprise determines the business activities of competing and allocating resources in the medium and long term in order to achieve its goals For example, centralized growth strategy (market penetration,

be businesses or product categories The strategy aims to guide the development

of each industry or product category and contribute to the completion of the company's strategies It is necessary to determine the advantages of each industry over competitors in order to formulate a strategy consistent with the company's strategies

An enterprise's strategies are a collection of decisions that have a lasting and profound impact on its position in the environment and its role in controlling the environment The strategy of an enterprise includes many functional strategies, among which P Y Barreyre (1976) proposed six functional strategies, of which production and trade strategies play a central role, which is the basis for formulating other functional strategies:

Trade strategy is a set of long-term policies to determine the position of enterprises in the market

Financial strategy is a set of policies to ensure that the financial needs for pursuing commercial goals match the conditions set by the capital market

Production strategy is a set of policies aimed at determining the types of products to be produced, the quantity of each product and allocating vehicles or production resources to effectively produce products to the market

Social strategy is a set of policies aimed at establishing the behavior of enterprises towards the labor market and, more broadly, towards the socio-economic and cultural environment

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Technological innovation strategy is a set of policies to research and develop new products and technologies and improve existing products and technological methods in use

Procurement and logistics strategy is a set of policies to ensure "good procurement" and rational use of material resources from procurement to product production and consumption If the business strategy aims to "sell well", then the shopping strategies of "buy sell" and "buy well" are like selling well

These strategies are collectively referred to as enterprise management strategies These strategies influence each other One strategy is the premise of formulating another strategy, and the implementation of one strategy will affect the implementation of other strategies

1.2.4 Factors influencing business strategy

The business environment of the enterprise includes:

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forces are "uncontrollable" forces that the company must monitor and deal with, including five main forces, namely economic, political, social, natural and technological forces

❖ Economic factors

Economic factors greatly affect enterprises in all aspects of production and business activities The economic factors of enterprises are determined by the economic potential of the country, including: economic growth, bank interest rate, inflation rate, economic cycle, balance of payments accounting, monetary policy, unemployment level and national income The market needs purchasing power and the public The existing purchasing power in an economy depends on the existing income, price, savings, debt and the ability to obtain loans Strategic planning must study the main trends of consumer income and expenditure patterns Each of the above factors may be a business opportunity for the enterprise, and may also pose a threat to the business development of the enterprise Economic factor analysis can help managers make forecasts and draw conclusions about the main trends of future environmental changes, which is the basis of industry forecasts and trade forecasts

In Vietnam, the socialist-oriented market economy has played an active role Vietnam continues to implement the open policy, and foreign investment in Vietnam has developed Vietnam has joined the WTO, and it has many new opportunities for development, as well as new threats, and will have more competitors

❖ Political and legal factors:

The government's policies for managing and controlling the economy include import and export policies and price policies; The salary policy that the organization must apply Economic management policies include inflation control policies, external debt levels, budget deficit ratio and business support services, such as transportation infrastructure development, supply system electricity, water supply system, information, medical care and banking services

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The impact of government Political factors study the way government policy impacts on business environment and trading Taxation, corruption, trade barriers, government stability, employment, and operational regulations are all factors to consider (O'Brien 2015, 199) Economic factors examine external economic events that may have an impact on a company's operations Economic growth, inflation rates, interest rate fluctuations, GDP trends, government expenditure, economic stability, and raw material demand are all factors to consider It contains a large number of points; however, it is not necessary to go over each one in detail Depending on the type of business, we should pay different amounts of attention to them (O’Brien 2015, 199.) Moreover, the three aspects that might influence international operation need to be studied in terms of economic analysis; they are economic freedom, economic systems and economic indicators (Daniels et al 2013, 184-185)

Legislative changes occur from time to time, and many of them have an impact on the business environment Legal factors comprise regulation on product safety, health and safety, employment, and competition law (Rao et al 2008, 116) Environmental factors, as well as the location of the targeted country, have an impact on the types of trades that businesses engage in Climate change affects the way businesses do business and how customers react to new products Environmental factors include government policies on pollution and recycling, as well as the use of environmentally friendly products (Johnson et al 2011, 68)

These policies increase or decrease the risk level according to its consistency and openness These policies are institutionalized into law and have legal effect on commercial activities On the other hand, the degree of political stability and the sustainability of the government are environments that can create opportunities or risks for enterprises, sometimes determining the survival and development of each organization In general, organizations can operate because social conditions permit As long as society no longer accepts certain actual

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situations and backgrounds, it will withdraw such permission by asking the government to intervene through a policy system or legal system

❖ Social factors:

Cultural trends, customer demographics, and lifestyle aspects of the market

in which a company operates are all analyzed by social factors Demographics, population distribution, education, life expectancy, purchasing habits, lifestyle, and social conventions are all areas that must be investigated (Johnson et al 2011, 68.)

Every business organization operates in a certain social environment, and there is a close connection and interaction between the organization and the environment The society provides the resources needed by enterprises and consumes the products produced by enterprises Social common values, traditional customs, people's lifestyle, population structure and people's income all have an impact on the operation of enterprise organizations

Demographic statistics of the population in the Strategic Area include the total population, sex and age, population density and distribution These data are crucial for strategic planning, factory positioning or product distribution, and are

an important basis for administrators to decide whether to invest or enter the market

The purchasing power of high-income residential areas will be greater than that of low-income residential areas On the other hand, the consumption patterns, purchasing dynamics and people's commodity demand of highly educated people will be different from those of low-educated people Age and gender are also data that any organization must master, because they are the basis for determining consumer needs

❖ Natural factors:

Natural factors have always been a particularly important factor in human life, and also an important input of economic sectors Natural factors include geographical location, climate, land, rivers, oceans, surface and underground

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mineral resources, such as oil, coal, water resources, natural forests and ecological environment These resources are becoming scarcer and scarcer, although nowadays, with the development of modern technology, people use raw materials more economically than before Understanding natural factors is helpful for enterprises to give full play to their advantages, protect the environment and make correct decisions and implementation measures

❖ Technical factors:

The way a company delivers its product or service to its target market can

be influenced by technology Internet infrastructure and penetration, government R&D spending, infrastructure level, patents and licenses, outsourcing use, and technology change rate are all factors to consider (Johnson et al 2011, 68) Moreover, technological factors comprises technology inducement, computerization and mechanization (Babatunde and Adebisi 2012)

In recent years, science and technology have developed rapidly The progress of science and technology and its application in the fields of production and management are the main factors affecting the business of enterprises Enterprises must recognize and use appropriate technologies to create business advantages in the market In order to limit the risk of backward technology and seize business opportunities, enterprises must regularly evaluate the efficiency of the technology used and closely monitor the development of technology and the development of the technology market Pay more and more attention to R&D, and

be wary of new technologies that may make their products outdated directly or indirectly Since then, strategic managers have been required to pay regular attention to changes and invest in technological progress, especially enterprises should pay due attention to the application of new information technologies in their production and business activities

1.2.4.2 Industry environment

Including external factors that directly affect the operation of enterprises, these factors determine the nature and degree of competition in the industry Show

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how customers and competitors require or implement, and compare whether business responses are on demand on this basis There are five basic factors: competitors, suppliers, customers, potential new competitors and alternative products/services

The task of business strategists is to identify and analyze the elements of the environment, and how do they affect the development strategy of enterprises? From there, identify the opportunities and potential risks of the enterprise

❖ Current Competitors:

Competitors are companies engaged in the same business as enterprises, and they hope to increase sales revenue and profits through policies and measures that are unfavorable to enterprises Two factors that strongly affect the competition

of an industry are the business volume and profit margin of the industry

❖ Suppliers:

Suppliers invest in enterprises, such as machinery, equipment, materials, spare parts, design consulting services and transportation services In essence, the relationship between enterprises and suppliers is a relationship of strength If materials and equipment are scarce, we must find them, and vice versa They must rely on us, so enterprises must establish relationships Long-term close relationship with material and service suppliers Enterprises need to establish a competitive position in the supply process, and strategic alliance and supply contracts are solutions to reduce the pressure of this environmental factor

❖ Customers:

As a buyer of enterprise products and an important factor in enterprise operation, it is very important for the survival of enterprises Enterprises must ensure the interests of customers and find all measures to meet the highest needs

of customers However, when purchasing, customers often use their own strength

to put forward unfavorable requirements on the seller's purchase price, payment terms and product quality Causing pressure to reduce corporate profits Therefore, customers and customer needs have great influence on the planning of enterprise

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business development strategy In-depth understanding of customers in all aspects

is an urgent requirement for the survival and development of enterprises The client's right to negotiate is usually maintained under the following circumstances:

+ Few customers buy large quantities of goods from sellers

+ The degree of specialization of goods purchased by customers is relatively low

+ Customers can easily switch to other suppliers

❖ Potential new competitors:

In a market economy, competition will promote social development and benefit consumers Competition will eliminate vulnerable enterprises that cannot adapt to the environment and increase the ability of other enterprises to enter the market The threat of this new competitor is to occupy the market share of existing manufacturers and reduce the average profits of future industries, thus forcing enterprises to make judgments and responses The most important obstacles for new enterprises to enter an industry are the scale of production and the necessary capital demand

❖ Alternative products and services:

It is the product of competitors or other industries, which can meet the needs

of consumers, rather than the products provided by enterprises Basically, alternatives usually have unique functions The emergence of very diversified and complex substitutes poses a very strong risk of price competition for old products, thus reducing the profits of enterprises The biggest driving factor for the emergence of alternative products is the progress of science, technology and production technology, so enterprises must regularly analyze, monitor and properly invest in research and development For basic commodities that cannot

be replaced by any other commodities, manufacturers will not be threatened by this factor

1.2.4.3 Internal environment of the enterprise

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Any enterprise has its strengths and weaknesses in its business field The evaluation and analysis of internal factors of an enterprise is an evaluation of the advantages and disadvantages of the relationship between functional departments

of an enterprise, including: human resources, production, finance, marketing, research and development, and information

❖ Human resources:

Human resources include administrative personnel and administrative personnel at all levels in enterprises Analyze human resources to help enterprises evaluate the advantages and disadvantages of organization members in each functional department in time according to job requirements, so as to make salary plans Reasonable arrangement, training and use of resources to help enterprises ensure the success of the proposed strategy

❖ Production:

Educational publications are the main activity of an enterprise, which is related to the creation of products and services Its main factors include the functions of publications, service quality and low cost to satisfy customers Analyzing production and business activities helps enterprises create competitive advantages compared with competitors

❖ Finance:

With regard to the use of material resources in enterprises in each period, analyzing and evaluating financial activities will help enterprises control their financial activities Financial factors, such as the ability to mobilize capital, capital sources, and the ratio of loans and equity, serve production and business decisions

At the same time, it can help enterprises understand the cost of creating advantages for enterprises

❖ Marketing:

The marketing activities of enterprises include conducting market research

to identify business opportunities, planning product distribution strategies, and setting prices suitable for the target market of enterprises It is the main factor to

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promote the satisfaction of market supply and demand, and it is also an essential factor to promote the business activities of enterprises

❖ Research and development:

Help enterprises effectively apply advanced technology, create competitive advantage in production and development, improve product quality, improve production process and reduce costs

❖ Information:

Information system analysis is helpful to judge whether the current information of the enterprise is complete, whether the collected information is accurate and timely across departments, and helps the enterprise to obtain high-precision and complete information as the basis for formulating correct strategies

In short, in the strategic management of enterprises, special attention should

be paid to the analysis of their operating environment Environmental interpretation covers all fields and affects all aspects of the strategic management process The purpose of business environment analysis is to find out strengths, weaknesses, opportunities and threats, and formulate reasonable business strategies on this basis

1.3 Tools used to study strategic management

1.3.1 Basic model of strategic management

Figure 1.1 The basic model of strategic management

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(Source : The Textbook of Strategic Management – Help University, Malaysia)

Figure 1.1 shows the components and elements of the basic model of strategic management It is very important to develop the basic model of strategic management because it provides a basic framework for understanding how strategic management works at the company level Moreover, the basic model of strategic management provides managers and strategists with a deeper understanding of the iterative methods of truly strategic management in organizations

The basic model of strategic management begins with the development of organizational vision and mission The vision and mission of the organization will then be translated into the objectives and strategies of the organization These factors indicate the direction and areas of concern of an organization Once these factors are identified, the role of the manager or strategist is to conduct organizational analysis This involves three types of analysis, namely, external environment analysis, internal organization analysis, and then industry analysis Each of these analyses will provide information on opportunities and threats, strengths and weaknesses, and help the organization position itself relative to other competing organizations in the industry Therefore, the results of these analyses will help managers and strategists match the appropriate areas to focus on, determine the special capabilities of organizations, and determine the competitive position that organizations need to adopt in order to maintain their competitive advantages in the industry

The results of the strategic analysis will then help managers or strategists identify potential alternatives available to the organization Choosing the appropriate strategic choice will be ready for implementation During the implementation of the strategy, the organization must ensure that the elements in the implementation process are properly implemented This means that the organization's goals must be determined at the operational level and transformed into more specific and accurate objectives than those set by the organization

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Policies in organizations need to be developed and applied Then, specific action plans or plans should be prepared to ensure the effective implementation of the organization's strategy Implementation of the strategy will not be completed without ensuring that all the essential elements of its implementation are in place This includes ensuring that the Organization has the appropriate structure, personnel and leadership to manage the implementation of the selected action plan Finally, implementation also requires managers or strategists to coordinate and integrate functional areas in the organization so that the systems and processes that manage the various multi-functional areas are synchronized with the previously set organizational objectives

From the basic model of strategic management, Akira Education Co., Ltd has chosen two specific types for its organizational model: Delta Project model and Strategy Map

1.3.2 Two basic tools of strategic management

⮚ Delta Project model

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Figure 1.2 Delta Project model

(Source : The Textbook of Strategic Management – Help University, Malaysia)

Delta model is a strategic management method based on customers Compared with the philosophical focus on product characteristics (product economics), this model is based on consumption economics The purpose is to establish a very close relationship between the company and customers The customer-centric model was developed by DeanWilde and Arnoldo Hax The development of Delta model has produced a large number of researches on the motivation of sustainable profit of enterprises

A unique set of frameworks and methodologies developed from the fact that the business world has changed so much that existing regulatory frameworks have become ineffective or incomplete These great advances are attributed to the Internet The Internet has created great potential for communication, and the incredible technologies surrounding e-commerce and e-commerce have enabled new business methods to be realized The idea is to let companies not focus too much on competitors, but focus more on customers

New in the Delta model is a triangle that reflects three strategic positions of the business including: Customer solutions, Low Cost, Differentiation

This process is demonstrated with 3 basic contents :

us the strategic position to show us new profit sources

⮚ Strategy Map

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Figure 1.3 Strategy Map

(Source : Kaplan, R.S and D.P Norton, 1996)

A strategic map is a chart used to record the main strategic goals pursued

by an organization or management team This is an element of the literature related

to the Balanced Scorecard, especially the characteristics of the design of the second generation Balanced Scorecard, which first appeared in the mid-1990s The first such charts appeared in the early 1990s, and in 1996 Drs Robert S Kaplan and David P Norton discussed the idea of using them to help document the Balanced Scorecard in an article Strategy map is developed on the basis of the Balanced Scorecard (Balanced Scorecard - a standardization tool between the strategy and activities of the enterprise): describes how an organization creates values that connect strategic goals with each other in a clear cause-and-effect relationship It

is a company performance measurement system that considers not only financial metrics, but also customer metrics, business processes, training and development

 Vertically linked target collections span viewpoints These are called strategic themes

 There is a clear causal relationship between these goals in all aspects Strategic themes represent assumptions about how the strategy will bring about change in organizational results

 In a wider range of publishing sources, a more relaxed approach is sometimes used In these methods, there are only a few public properties Some take advantage of broader causal relationships between goals, which are shown by arrows, linked together, or placed in a way that is not linked

to a specific goal but provides general indications of where the causal relationships are

Key principles of strategy map:

✔ Strategies for balancing sources of conflict

✔ Customer strategy with different values

✔ Values are created thanks to the internal force of the Enterprise

✔ Strategies include complementary and concurrent themes

✔ Strategic alignment determines the value of intangible assets

With a strategy map, all information (in terms of 4 aspects: financial, customer, internal, training and development) will be aggregated on one page, which helps the communication process easier

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The financial sector will focus on building long-term shareholder value and building a cost structure that leverages assets based on a productivity strategy and

a growth strategy that expands opportunities and enhances customer value

The last four elements of strategic innovation are supported by price, availability, selectivity, functionality, service, partners and brands

From the company's internal perspective, the process of operating and managing human relations, information management and company capital Company capital is understood as company culture, leadership, alignment and teamwork Finally, the employee – consequence relationship is depicted and arrowed

1.4 The Customer Focus Approach

1.4.1 Concepts of the Customer Focus Approach

To succeed customer-centred approach, organizations need to implement a

"customer-centred strategy" to ensure a high degree of consensus and cohesion around the belief that their survival depends on meeting customer needs To be truly successful, an organization must ensure an excellent customer experience and continuously add value to its customers

Customer focus is described as a set of beliefs that put the interests of customers first in developing long-term profitable business, while not excluding the interests of all other stakeholders, such as owners, managers and employees (Deshpande et al., 1993) Customer focus is also defined as an organization's focus

on customer needs, hopes, and expectations (past, present, and future); And their firm commitment to actively understand and respond to their long-term development (Bartley et al., 2007) The ultimate goal of customer focus is to realize customer expectations (Tajeddini et al., 2013) Organizations can truly accept customer centrality only when they attach importance to customers as a deep-rooted culture in the organization (Kennedy et al., 2002) An effective customer focused quarterly culture within an organization contributes to the successful delivery of products and services and to the building of long-term

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relationships and a loyal customer base (Martin, 1992; Macaulay and Clark, 1998) Sun and Kim (2013) reported that focusing on customers may significantly affect the company's financial performance

1.4.2 Need for Customer Focused Strategy

Customer attention has a positive impact on new product performance and company performance (Nickell et al., 2013) A client-centred approach has been identified as key to any organization seeking to achieve a sustainable level of performance (Mokhtar, 2013) Sustainable performance refers to an organization's expectation that it can respond quickly and effectively when facing new customer-related problems Considering the dynamic nature of customer expectations, this

is an important factor (Mukerjee, 2013) Therefore, the customer focused strategy has attracted a lot of attention

Without a customer focused strategy, organizations should not expect term survival, let alone success Although the importance of "customer focused" has been recognized, the academic and practical circles pay less attention to customer focused strategic analysis Organizations need a customer focused strategy to design a systematic process, and build resources and capabilities to activate a perceptive customer center to shape priorities, behaviors, and systems The purpose of this study is to emphasize the importance of customer focused strategy in organizations Provide a support framework to emphasize its various attributes and formulate various suggestions for the successful implementation of the customer focused strategy

long-Various studies and survey results emphasize that customer focus is an important business priority, and customer focus strategy has a positive impact on customer experience, which has a significant impact on the future expenditure of transaction and relationship business In the transaction business, the customer with the highest customer experience score spends 2.4 times more per year than the customer with the worst customer experience score Customers with experience scores of 9 (1 to 10) spend 90% more than customers with poor

et al., 2003)

1.4.3 Building Customer Focused Strategy

Customer focused strategy is helpful for organizations to improve overall performance and build competitive advantage Customer focused strategy requires market ability (external focus, that is, customer insight and competitor awareness) and organizational ability (internal focus, that is, CEO leadership, customer value creation, collaboration mode, decision-making standard and salary reward system) Aims at maintaining a high level of organizational performance by effectively and efficiently taking the actions required to deliver superior customer value In short, a customer focused strategy requires seven components, such as CEO leadership, collaboration, compensation and reward system, customer insight, decision-making criteria, competitor awareness and customer value creation Here, the customer focused strategy is the dependent variable, and all seven CS are independent variables All these components of a customer-centred strategy are described below:

CEO Leadership:

The important role of CEO or top management is to create the culture and environment of the organization It is important for senior management to implement programs that encourage departments to achieve goals together, promote mutual understanding, work together informally, and share the same

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vision, ideas and resources (Kahn, 1996) Culture is always built at the highest level and spread down, reflecting the values, beliefs and actions of its senior leaders An organization's vision and values should inspire employees to be customer focused Microsoft's Bill Gates, Southwest's Herb Kelleher (former), Zapos's Tony Hsieh and Amazon's Jeff Bezos are among the chief executives known for their emphasis on culture and willingness to take concrete cultural-building actions (Bartley et al., 2007)

Collaborative Approach

In the customer focused strategy, the main function of cooperation is to create and enhance value for customers It consists of internal departments and external partners to solve customer problems, and also includes multi-functional methods and collaborative value networks The cooperation between network-related functions is established between individuals and teams within the organization, while the cooperation value network includes the interaction between teams inside and outside the organization (Madhani, 2018) If customers feel neglected because they have to repeat themselves, they feel that the organization

is not customer focused The Zendesk survey showed that more than 70% of customers expect companies to collaborate on their behalf, and 68% feel uncomfortable when their calls move between departments (Zendesk, 2020)

Customer Insight

Customers' preferences change over time, and organizations must stay in touch with customers to determine the "value" they seek Customer focused organizations need to keep up with the changing needs and customer focused behavior of their customers and adapt their products to the modern needs of their customers Customer-oriented behavior can be defined as "the ability to identify, evaluate, understand and meet customer needs" (Reychav and Weisberg, 2009) Employees are empowered and have the opportunity to engage with customers to deepen their understanding of what customers really value Give employees more control over work-related situations and decisions, making them more flexible and

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responsible for different customer needs (Kim et al., 2004) Organizations such as

GE, IBM and DuPont closely monitor environmental trends and explain upcoming customer needs (Mukerjee, 2013)

Competitor Awareness

If an organization can build deep, promising and meaningful relationships with its customers, it will increase their loyalty and maintain a longer-term relationship with the organization When customers' needs are met, they are willing

to acquire from the same company to minimize the risk of acquiring from other companies, that is, competitors The perceived risk associated with any transaction

is regarded as a cost (e.g psychological cost) by customers (Sweeney et al 1999), and competitor orientation includes rapid response to competitors' behaviors of effectively acquiring, developing, serving and retaining customers (Im andWorkman, 2004; Narver and Slater, 1990)

Customer Value

A customer focused strategy advocates an organizational culture dedicated

to enhancing customer value and building strong relationships with customers The creation of customer value should penetrate into everyone and every process in the organization Because value creation is the key to customer satisfaction, it has a lasting impact on customer relationships Creating customer value is central to a customer focused strategy because it is synchronized with all the other components, namely CEO leadership, collaborative approach, compensation and reward systems, customer insight, decision-making criteria, and a sense of competition As market dynamics change, customer value advice provided by enterprises must be improved (Gulati and Oldroyd, 2005) Therefore, all functional activities should be integrated and consistent, defining the responsibilities of everyone in the organization in the sense of creating and providing excellent value for customers, so that every employee can understand, trust and implement the

"customer first" culture To ensure that satisfied and loyal customers feel heard,

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organizations will need the same organizational connectivity layer to provide them with a fully integrated view of their customers

1.5 Business performance

1.5.1 Concepts of business performance

In today's economic environment, enterprise performance measurement is

a key issue that academics and actual managers pay attention to Generally speaking, enterprise performance is defined as "the ability to conduct business to meet the wishes of major shareholders of the company" (Smith & Reece, 1999, p 153), which must be evaluated to measure the achievements of an organization Many studies have examined the influence of organizational practice and process

on the "bottom line", and vice versa (Wall et al., 2004) The review of the relationship between strategy and performance has been tested for more than 20 years; Many current studies also focus on this issue Scholars consider the importance of performance evaluation and practice to organizations (Dess & Robinson, 1984; Sapienza et al., 1988; McGrath et al., 1995; Song et al., 2005; Gruber et al., 2010) Many studies also focus on the operation of small and medium-sized companies (Pelham & Wilson, 1996; Jarvis et al., 2000; Alasadi & Abdelrahim, 2008; Thomas et al., 2008)

Business Performance Evaluation (BPM) is very important for identifying many research areas of interest to academics and practitioners, especially management and psychology Operational activities are often evaluated by academics and practitioners as a means of monitoring the activities of institutions Many definitions are used to define performance, one of which explains that performance is "the ability to perform to meet the aspirations of the company's main stakeholders" (smith & reece, 1999, p 153), which is a subset of the overall concept of organizational performance (venkatraman & ramanujam, 1986) This suggests that business performance must be assessed by measuring success or failure in order to achieve organizational goals and can be determined in several ways, such as subjective or objective, financial or non-financial In the discussion

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on measuring business performance, most participants mentioned indicators that would help businesses track current and past performance; Most indicators are based on accounting measures, such as return on investment (ROI), return on assets (ROA) and earnings per share, including revenue or number of customers (Wood, 2006) However, scholars often criticize the use of such accounting measures because they mainly focus on economic aspects and ignore other aspects of company performance (Quinn and Rolberg, 1983; Venkat Raman and Ramanujam, 1986) As an example, Theo Simpson et al (2006) If the business changes, the business performance evaluation may change-this may affect the return on investment The expanded areas of business activities also include marketing and financial aspects such as profit, market share and sales growth (Feng et al., 2008)

1.5.2 Financial indicators to evaluate business performance

a Return on assets – ROA

Return on Assets (ROA) represents the percentage of income generated by a company's assets

The ROA can be calculate as follows:

ROA = 100% x

Net Income Average Total Assets Since net profit divided by income equals the marginal profit rate, and the average value of income divided by total assets equals the turnover rate of total assets, there is another method to calculate the rate of return on assets, namely: Rate of return on assets = marginal rate of return × total turnover of assets

b Return on Sales – ROS

Return on Sales (ROS) is a financial ratio used to track the profitability of a company It reflects the relationship between shareholders' net profit and company sales

The rate of Return on Sales in a certain period is calculated by dividing the net profit or after-tax profit in that period by the income in that period The unit of calculation is%