ĐẠI HỌC QUOC GIA HÀ NOI KHOA QUAN TRI VÀ KINH DOANHTRINH THANH HUNG FINE-TUNING AND PROPOSING SOLUTIONS TO DEPLOY THE STRATEGY OF THE NATIONAL POWER TRANSMISSION CORPORATION LUẬN VAN THẠ
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Strategic management begins with identifying an organization's current tasks, objectives, and strategies, as highlighted by Fred R David (2006) This foundational assessment allows companies to eliminate certain strategies and dictate specific actions based on their unique situations and conditions Every organization possesses a mission, goals, and a strategy that reflect its historical experiences The strategic management process must be dynamic and continuous, as changes in one component can necessitate adjustments in others Consequently, the activities of strategy formulation, implementation, and evaluation should be ongoing rather than confined to specific times of the year, emphasizing that the strategic management process is perpetual.
1.5.2 Analyze the outside environment a Macro environment e Economic environment: An economic field that includes all macroeconomic data, current statistics, changing trends that are taking place These statistics are very useful for assessing a company's business industry and competitive environment. Economic information includes: bank interest, exchange rate, budget surplus or deficit, trade surplus or deficit, inflation rate, gross national product, cycle results
Understanding economic indicators such as income, expenditure, and unemployment rates is crucial for managers By analyzing these statistics and forecasting trends, they can assess their potential impact on the company For instance, evaluating whether an increase in bank interest rates will be advantageous or detrimental to the business is essential for informed decision-making.
Corporations must adhere to government regulations and laws, which significantly impact their strategies Key factors include tax regulations, safety and environmental protections, import and export policies, industrial property rights, and the overall stability of the political and social landscape These elements are particularly crucial for corporations operating in sectors like energy and utilities.
Socio-cultural factors encompass the spiritual values unique to each nation, influencing consumer behavior and presenting intangible challenges for companies entering new markets To mitigate negative reactions from the public and respect traditional values, thorough research is essential By understanding the socio-cultural environment, managers can prevent potential losses and protect the company's reputation Additionally, insights into population demographics within specific geographic areas are crucial for determining human resources and customer bases Prior to investing in a particular market, companies must analyze these demographic characteristics alongside socio-cultural factors to make informed decisions.
+ Build facilities where is the most convenient.
+ Decide the type of product with the appropriate size for the market area.
The increasing scarcity of natural resources and the rising levels of environmental pollution have heightened public concern about the quality of the natural environment As a result, various organizations have brought critical environmental issues, including energy shortages and the excessive consumption of resources, to the attention of the government This growing awareness is prompting strategic managers to reevaluate their decisions and adopt new measures to address these pressing challenges.
Technology is a dynamic force that presents both opportunities and risks for businesses across all industries As the economy evolves, advanced technologies emerge, fostering new markets and leading to the introduction of innovative products that can displace outdated ones This constant technological advancement reshapes competitive dynamics within industries According to Michael E Porter’s model (1985), the competitive landscape is defined by five key factors: competitors, customers, suppliers, potential competitors, and substitute products, all of which play a crucial role in shaping business strategies.
The threat of new competitors | entering |
Supplier's Competitors in the industry ability to Buyer's Buyer's force ability to ability to force force
Michael E Porter's 5-forces model of competition highlights the significance of competitors in the marketplace A competitor is defined as any organization offering products or services that meet similar customer needs This understanding is crucial for administrators, as they navigate a landscape where competition is a key factor influencing strategic decisions.
Many companies fail to recognize competitive threats in a timely manner, often leading to detrimental consequences A crucial element that influences customer decisions is the competitive factor A common mistake among managers is viewing competition solely from the supplier's perspective, rather than considering the customer's viewpoint.
Throughout its operations, the Company encountered various competitors, making the identification and comprehension of these rivals crucial to its success Key types of competitors include:
- Direct competitors or trademark competitors: are companies that produce products with the same use and supply to the same target customers at similar prices.
- Competitors producing alternative products: are companies that manufacture other products to meet the same needs of target customers.
Potential competitors pose a significant threat to companies, as they leverage new technologies to create innovative products that can replace existing offerings To effectively counter this challenge, businesses must continuously monitor market and industry trends to identify emerging competitors and develop strategic responses Additionally, competitors vying for the same budget-conscious target customers can influence purchasing decisions, particularly among households with limited financial resources Therefore, understanding customer needs, preferences, and behaviors is crucial for companies to attract and retain clients By focusing on delivering products that meet customer demands rather than solely promoting existing inventory, companies can reduce risks and foster growth.
Customer trust is the company's most valuable asset, cultivated by effectively meeting their needs and preferences better than competitors A key aspect of this relationship is the customers' bidding power, as dominant buyers can impact industry profits by pressuring prices, demanding higher quality, and expecting additional services.
Categorize customers according to criteria to have a market segmentation strategy: age, gender, income, locality, geography, religion, beliefs and culture Besides, the
Meeting the 13 customer requirements for quality and price presents ongoing challenges for companies, as failure to do so can lead customers to switch to alternative products or competitors offering better value This situation forces companies to invest more in research and development to create products that meet customer expectations while simultaneously seeking cost-saving measures to reduce production expenses and enhance labor productivity Balancing input costs with output prices is a complex task; neglecting this can indicate low competitiveness, making it easy for rivals to capture market share Additionally, businesses face pressure from suppliers of equipment, materials, capital, and labor, further complicating their operational landscape.
To mitigate risks, businesses should engage with multiple material and equipment suppliers rather than relying heavily on a single source This diversification helps prevent potential issues such as price hikes or declines in product quality, which can arise from an over-dependence on one supplier.
For capital suppliers: Most businesses have to borrow capital to run their business.
To avoid dependence too much on a type of capital mobilization, it is necessary to study a reasonable capital structure.
Human resources play a crucial role in sustainable business development, necessitating effective recruitment and training strategies to attract a skilled workforce Additionally, potential competitors—those not yet in the market but capable of future competition—pose a threat, with their competitiveness influenced by barriers to entry such as economies of scale, product differentiation, and the advantages held by current players Furthermore, the emergence of substitute products in a dynamic market responds to evolving consumer demands, often presenting a greater competitive challenge than the original products, thereby impacting the pricing strategies of existing companies.
Descriptive statistics and strategic planning matrix methods
Statistical analysis, comparison and logical inference to synthesize data and data in order to determine the selected objectives, options and strategic solutions.
Descriptive statistics and strategic planning matrix methods (IFE; EFE; SWOT ).
Analysis, evaluation, CONCIUSION 0< G5 9 9 %4 99.6 01 99098 860068969096 27 2.5 An overview of the National Power Transmission Corporation
- Through the primary data, the author has made assessments and conclusions after each data table in the attached chapters
- Through the survey, up to 80% of people have the opinion that: Interested in the strategy of EVNNPT in the future; It is necessary to develop a mission for EVNNPT;
Establishing a connection with the regional electricity grid is essential for effective energy management Additionally, developing a comprehensive strategy for EVNNPT is crucial for future growth Interestingly, 11% of survey respondents expressed neutrality on this matter, while 9% believed that such a connection is not necessary.
In-depth interviews with leaders of the Corporation reveal that 90% believe that EVNNPT is essential for developing a strategic growth plan, while 6% support aligning with the Group's overall development strategy Additionally, 4% maintain a neutral stance, emphasizing the importance of individual leadership roles in fulfilling their responsibilities.
2.5 An overview of the National Power Transmission Corporation
2.5.1 The process of formation and development
The National Power Transmission Corporation is the sole state-owned entity responsible for the continuous, safe, and stable development and operation of Vietnam's nationwide power transmission system, supporting economic, political, communal activities, as well as national security, defense, and the electricity market.
EVNNPT is dedicated to fulfilling its responsibilities to the nation and its customers by adhering to state regulations and both national and international standards The organization prioritizes transparency in all operations while ensuring the highest quality of service Committed to economic, social, and environmental efficiency, EVNNPT operates with a unified team that embodies faith and conscientiousness in their work.
EVNNPT stands out as a premier power transmission company in the ASEAN region, actively advancing its technology and management practices The organization is committed to evolving into a leading power transmission enterprise not only in Asia but also on a global scale.
Before 2008, Vietnam Electricity (EVN) oversaw four power transmission companies and three project management boards across the North, Central, and South regions On April 11, 2008, EVN established the National Power Transmission Corporation (EVNNPT) through the reorganization of these entities The four power transmission companies were designated as follows: Company 1 served the area from Ha Tinh to the northernmost point of the country; Company 2 operated from Quang Binh to Quang Ngai; Company 3 covered Binh Dinh to Phan Rang; and Company 4 managed the region from Dong Nai to the southern tip of Vietnam.
EVNNPT, a subsidiary of EVN and part of the Ministry of Industry and Trade, has been designated by the National Assembly as the exclusive entity in the power sector Its primary responsibilities include ensuring energy security and fulfilling the political and economic objectives of the country.
July 2015: Prime Minister issued a special rating decision for EVNNPT.
EVNNPT is a state-owned enterprise governed by the Law on State Enterprises and operates as a subsidiary of Vietnam Electricity It possesses independent legal status, complete with its own stamp, logo, and organizational charter Additionally, EVNNPT adheres to specific financial regulations and is accountable for upholding its legal rights and obligations.
The National Power Transmission Corporation (EVNNPT) is a one-member limited liability company operating under Vietnam Electricity (EVN) It was established following Official Letter No 1339/VPCP-DMDN dated March 3, 2008, from the Government Office, and Decision No 223/QD-EVN issued by the Board of Directors of EVN on April 11, 2008.
OFFICE OF BOARD OF MEMBER - BOARD OF DIRECTORS DIRECTORS DEPT MR NGUYEN MINH THANG
INTERNAL AUDIT AND MEMBER - BOARD OF DIRECTORS FINANCIAL SUPERVISION DEPT MR NGUYEN NGOC TAN
VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT
CONSTRUCTION AND INVERTMENT TECHNICAL ECONOMICS AND FINANCE
MR BUI VAN KIEN MR LUU VIET TIEN MR VU TRAN NGUYEN
PROCUREMENT TELECOMMUNICATION AND MANAGEMENT DEPT INFORMATION TECHNOLOGY DEPT
NORTHERN POWER PROJECTS POWER TRANSMISSION MANAGEMENT BOARD COMPANY NO 1
CENTRAL POWER PROJECTS POWER TRANSMISSION MANAGEMENT BOARD COMPANY NO 2
SOUTHERN POWER PROJECTS POWER TRANSMISSION MANAGEMENT BOARD COMPANY NO 3
CONSTRUCTION MANAGEMENT DEPT CORPORATE PLANNING DEPT
Our company specializes in electricity transmission activities under the Electricity operation license, focusing on the investment and development of the transmission grid We offer comprehensive management, operation, and repair services for power grids, alongside expert consulting in construction investment and project management Our services extend to supervising the construction of power grid projects and telecommunications infrastructure, ensuring effective installation and management of telecommunications equipment and systems We also provide electrical testing and training programs to enhance human resources for grid management and operation Furthermore, we facilitate investment in automation and control, capital generation, and the construction and maintenance of substations and transmission stations, all in compliance with national laws and policies while fostering international power grid connections.
Relevant industries and trades that directly support core business activities include manufacturing, importing and exporting, and trading materials related to electrical grid equipment and telecommunications Additional services encompass the construction and installation of power grid projects, information technology services, operation of nursing facilities, leasing of machinery and equipment, and transportation for production and business purposes Other professions may also be included as approved by EVN in compliance with legal regulations.
As of February 2019, EVNNPT successfully managed and operated 24,950.03 kilometers of transmission lines, which included 7,827.34 kilometers of 500 kV lines and 17,122.69 kilometers of 220 kV lines This represents a significant growth, with an increase of 2.26 times since its establishment.
The national power transmission system has significantly expanded, now comprising 153 substations, including 30 at 500 kV and 123 at 220 kV, with a total capacity of 91,256 MVA This marks a remarkable increase of 2.47 times in the number of substations and 4.31 times in overall capacity since its establishment The system effectively reaches all provinces and cities across the country and connects to regional power transmission grids, utilizing advanced technologies such as multi-circuit lines, multiple voltage power supplies, 220 kV underground cables, GIS stations, unmanned transformer stations, integrated computer control systems, fault locators, online oil monitoring, and SCADA systems.
The electricity transmission system of EVNNPT ranks 3rd among ASEAN countries and 8th among 24 power transmission organizations in Asia based on line length Additionally, it holds the 4th position in ASEAN and the 11th position in Asia regarding transformer capacity (MBA).
The National Power Transmission System employs over 7,800 skilled officers, engineers, and workers who manage high and super high voltage equipment, posing significant risks to safety Any errors or misunderstandings regarding safety protocols in electrical equipment operations can lead to serious accidents, jeopardizing the electricity supply across the entire Ministry of National Power System.
2.5.4 EVNNPT's business performance from 2015 to 2019
The business results of EVNNPT in the past 2015-2019 period are shown through the following indicators:
Table 2.4: Business results of EVNNPT in the period 2015-2019
(Source: EVNNPT Finance and Accounting Department-2019)
Perspectives and development goals of the National Power Transmission
Corporation to the year 2020-2025, vision to 2030.
The sustainable development of power transmission is crucial for Vietnam, as the sector must proactively ensure the safe, continuous, and stable delivery of electricity This is essential for supporting economic growth, political stability, social well-being, security, national defense, and market operations.
To enhance the modernization of electricity transmission, it is essential to improve all aspects of operation management, repair services, investment, and corporate governance, ensuring readiness for the evolving electricity market Upgrading power transmission systems will enable the integration of large-scale renewable energy sources while enhancing grid security and the quality of electricity transmission services.
The integration of scientific advancements from the Fourth Industrial Revolution is essential across various sectors, including construction, power transmission system management, and corporate governance By leveraging these innovations, organizations can enhance operational efficiency, improve technical services, and optimize management practices Embracing these technologies will drive progress and transform industries, ensuring sustainable growth and competitiveness in the modern economy.
- To optimize all resources inside and outside EVNNPT to ensure safe, continuous and stable power transmission, ensure the quality and reliability of power supply, and ensure economic criteria.
- Development of power transmission must adapt to climate change, ensure sustainable development and be consistent with the national green growth strategy.
- 2020: Become one of the four leading power transmission organizations in ASEAN.
- 2025: To become one of the power transmission organizations in the top 10 countries in Asia.
- Year 2030: Reaching world advanced level in the field of power transmission.
Ensuring a safe, continuous, and stable electricity transmission system is crucial for Vietnam's economic, political, social, security, and defense activities, as well as its electricity market In 2020, the total transmitted electricity output is projected to reach approximately 225 billion kWh, with an anticipated increase to around 351 billion kWh in subsequent years.
2025, about 502 billion kWh in 2030, and 774 billion kWh by 2040.
- Invest in and develop a modern power transmission system, ensure safe, continuous, stable power transmission with high reliability and ensure grid security.
- Building an advanced, modern, scientific organizational model and corporate governance model towards high efficiency.
- Promote research and development activities and enhance technology innovation. Promote the application of the achievements of the Industrial Revolution 4.0 in construction investment, operation management.
To maintain a stable and healthy financial status for EVNNPT's operations, it is essential that the electricity transmission pricing supports effective management, construction investments, and other activities This pricing structure must also provide a reasonable profit margin to attract potential investors to the power transmission system.
- Improve service quality efficiency for customers connected to the power transmission grid Brand enhancement and sustainable development of EVNNPT.
To enhance the efficient utilization of natural resources and improve the power transmission system, the development of grid connections is essential This includes constructing power grids that link Laos with neighboring countries, aiming to import approximately 1,000 MW by 2020, 3,000 MW by 2025, and around 5,000 MW by 2030 Additionally, it is crucial to build and develop human resources for operations management, technical services, and corporate governance to achieve a regional and international stature, enabling the export of these services to other nations.
EVNNPT is committed to fostering a corporate culture that embraces cultural diversity while promoting a unified awareness among its employees The organization prioritizes sustainable development, ensuring a green, clean, and safe environment, while also focusing on employee welfare and social equity Additionally, EVNNPT is dedicated to adapting to climate change and effectively fulfilling its social responsibilities in alignment with both Vietnamese and international regulations.
To achieve optimal results, we must prioritize the implementation of effective solutions while synchronizing and maximizing all available resources Investing in the construction, upgrading, and renovation of power grid infrastructure is essential to ensure that wind and solar energy sources can operate efficiently in the near future.
3.1.3 The impact of the development of solar energy and rooftop solar power on
ENVNPT's development strategy in the future
In Vietnam, the significant shortage of electric energy has made the development of renewable energy (RE) resources, particularly grid-connected and rooftop wind and solar power, an essential trend This approach is a crucial solution for maximizing the use of renewable natural resources to generate electricity, thereby supporting the country's socio-economic development.
The development of renewable energy sources is essential for environmental protection and combating climate change, while also utilizing wasteland unsuitable for agriculture for grid-connected projects By harnessing the potential of millions of rooftops from households, offices, and industrial zones for solar installations, we can address the urgent need for power source replenishment, enhance local economic benefits, and create job opportunities This initiative will help establish a robust renewable energy industry in Vietnam and contribute to achieving the goals set forth in Resolution 55 of the Politburo regarding the National Energy Development Strategy.
As the power system faces increasing pressure to maintain electricity supply, particularly since 2020 without new exploitation sources, the development of solar energy projects has become crucial Among these, rooftop solar power stands out as a key solution to alleviate the strain on the electricity industry, specifically benefiting ENVNPT.
Recent solar power projects have significantly strained the national power transmission system, primarily due to their concentration in male-dominated areas The current transmission infrastructure is unable to meet the rising demand, prompting an urgent need to enhance transmission capacity This situation poses challenges to the Transmission Corporation's electricity system development strategy.
Incorporating rooftop solar PV into the power system is essential for alleviating pressure on the national transmission system, as it primarily serves local needs without increasing overall demand This installation offers numerous advantages, providing the state with a significant source of clean energy while minimizing investment costs in power generation and transmission infrastructure Additionally, rooftop solar PV helps ease the burden on the grid and lowers electricity bills for consumers by decreasing reliance on grid power.
The Transmission Corporation's development strategy is shaped by the national power storage initiatives, including the establishment of hydroelectric storage facilities and the integration of national energy storage battery systems with solar power systems.
3.2 Analysis and selection of development strategy for EVNNPT to 2025
3.2.1 Analyze the ability to exploit strengths
In Chapter 1, the author outlines the various impacts of internal strengths and weaknesses, alongside external opportunities and threats These impacts vary in significance, leading to the prioritization of solutions that either mitigate risks or leverage advantages Strategies are developed by focusing on solutions with a strong influence or high occurrence rates The process involves a thorough analysis of how to maximize strengths, minimize weaknesses, and effectively capitalize on opportunities while addressing potential threats.