G1_00151 FORMULATION OF BUSINESS STRATEGY IN PERIOD OF 2012-2017, VISION TO 2012 FOR INVESTTECH GN COMPANY LIMITED INVESTMENT TECHNOLOGY AND EQUIPMENT GIA NGUYEN CO.,LTD needs to build up a suitable and proper business strategy for itself, to effectively use its resources to exploit opportunities and
Methods of research ‹‹aaijijÀÁ ii
To collect information, our group has used the following methods:
Primary data collection employs a mixed-methods approach, combining qualitative and quantitative techniques A structured questionnaire is distributed to a randomly selected sample that includes both company members and external respondents The survey aims to measure key performance dimensions, including customer satisfaction, technical quality, operational policies, and leadership within the company, with a focus on identifying opportunities for functional quality improvement.
- Collecting secondary data: internal documents of GNC
- Using acquired knowledge for researching, analyzing the internal and external business environment of the company and formulating company’s business strategy in period of 2012 — 2017, vision 2020.
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Mainly using statistical methods, synthesis, comparison, analysis to collect assessment of inside and outside information related to the company's business operation
The contents of topic, except for the introduction and conclusion, should be stated including 3 main Chapter as follow:
- Chapter I: Basic theory of business strategy and method for strategic formulation
- Chapter 2: Analysis of business environment and formulation for strategies of Investtech GN Co.,ltd
- Chapter 3: Analysis formulated strategies and selection business strategy for Investtech GN Co.,ltd (GNC) in period of 2012-2017, vision to 2022
Strategic planning provides a scientific foundation for how an enterprise uses its resources efficiently and clearly identifies its direction By aligning internal capabilities with market opportunities, it improves resource allocation, reduces waste, and supports informed, long‑term decision making In the Vietnamese context, however, several factors—such as inconsistent data, limited managerial training, and gaps between strategy development and execution—can diminish the impact of planning Addressing these challenges requires standardized methodologies, data‑driven analysis, and strong leadership commitment to translate strategic plans into concrete, actionable initiatives that drive performance and sustainable growth.
Many Vietnamese enterprises fail to engage seriously in strategic planning, and only a few adopt a rigorous, scientifically grounded approach to developing their business strategy This article offers a practical framework for planning a company’s strategy, built on a logical foundation and concrete applications, and it translates the valuable experiences of other enterprises into actionable guidance for Vietnamese firms.
Originating from the practical needs of its business activities at Investment Technology and Equipment Gia Nguyen Co., Ltd., the group is developing a feasible business strategy that emphasizes resilience during the current economic crisis and positions companies to survive today while enabling stronger growth in the future.
BASIC THEORY OF BUSINESS STRATEGY AND
ESTABLISH LONG-TERM PURPOSE: -ScSSeSsisereeeree 23 1.5 METHOD OF DEVELOPMENT AND SELECTION OF STRATEGY: 24 1.6 TOOLS FOR BUILDING AND SELECTION OF STRATEGIES
Long-term objectives reflect the expected results of pursuing strategies Strategies describe the methods to achieve these long-term objectives The timeframes for objectives and their strategies should be aligned, typically spanning two to five years.
Every objective is often accompanied by a period and some items such as capital growth, growth of consumption revenue, profitability, market share, level and nature of vertical combination
1.5 METHOD OF DEVELOPMENT AND SELECTION OF STRATEGY:
The Strategy-Formulation Analytical Framework
External Factor Competitive Internal Factor
Evaluation (EFE) Profile Evaluation (IFE)
STAGE 2: THE MATCHING STAGE trengths-Weaknesses- Strategic Position and Boston Consulting Internai-External Grand Strategy
_ Opportunities-Threats Action Evaluation Group (BCG) (IE) Matrix Matrix
(GWOT) Matrix (SPACE) Matrix Matrix ae : STAGE 3: THE DECISION STAGE
Quantitative Strategic Planning Matrix (QSPM)
Figure 4: The Strategy - Formulation Analytical framework
According to Fred R David, Process of formulating and selecting strategy consists three stages:
During the early stages of strategy formulation, input tools demand that strategists quantify subjectivity They must make small but crucial decisions within the input matrices to generate and evaluate alternative strategies Effective intuitive judgment is essential for assigning appropriate weights and ratings, guiding the selection of the best strategic options.
Stage Il THE MATCHING STAGE
Within the strategy-formulation process, the matching stage employs five versatile tools—the SWOT matrix, SPACE matrix, BCG matrix, IE matrix, and Grand Strategy Matrix—that can be used in any sequence These tools draw on data from the input stage to pair external opportunities and threats with internal strengths and weaknesses, enabling the alignment of critical success factors The core to generating feasible alternative strategies is the deliberate matching of internal capabilities with external conditions, ensuring strategies leverage strengths to capitalize on opportunities while addressing weaknesses and mitigating threats.
Stage HI THE DECISION STAGE
Analysis and intuitive insight form the basis of strategy formulation decisions, while the matching technique reveals feasible alternative strategies The Quantitative Strategic Planning Matrix (QSPM) integrates inputs from stage I and the analysis and matching results from stage II to choose among alternatives objectively As a decision-support tool, the QSPM enables strategists to evaluate and compare strategies based on identified external and internal critical success factors, but it requires sound intuitive judgment to interpret the results.
Because the company's resources are restricted and we may not choose all strategies and we can just select some strategies for implementation
Strategic management is a continuous, dynamic process in which a change in any major component of the model can trigger adjustments across other components Consequently, the activities of strategy formation, strategy implementation, and strategy evaluation must be carried out iteratively with ongoing monitoring The strategic management cycle relies on constant feedback and adaptation to evolving internal and external conditions, ensuring the organization remains aligned with its goals In short, the strategic management process never truly ends; it continuously evolves as the organization learns, responds, and improves.
1.6 TOOLS FOR BUILDING AND SELECTION OF STRATEGIES
1.6.1 The tool providing information to develop strategies
1.6.1.1.Matrix of Internal Factor Evaluation Matrix (IFE)
The Internal Factor Evaluation (IFE) Matrix is a key step in conducting an internal strategic management audit, providing a concise summary of a firm’s major strengths and weaknesses across its functional areas By organizing and evaluating these internal factors, the IFE matrix helps identify and prioritize issues that influence strategy formulation It also provides a basis for identifying and evaluating the relationships among different functional areas The IFE matrix can be developed in five steps, resulting in a structured tool for assessing internal capabilities and informing strategic decisions.
Step I: List key internal factor as identify in the internal-audit process Use a total of from 10 to 20 internal factor including both strengths and weaknesses List strengths first and then weaknesses.
Step II: Assign a weight that ranges from 0.0 (not important) to 1.0 (all- important) to each factor The weight assigned to a given factor indicates the relative importance of the factor to being successful in the firm’s industry The sum weights must equal 1.0
Step III: Assign a | to 4 rating to each factor to indicate whether that factor represents a major weakness ( rating = 1), a minor weakness ( rating = 2), a minor strengths (rating=3) or a major strengths (rating=4) Note that strengths must receive a 3 or 4 rating and weaknesses must receive a | or 2 rating Ratings are thus company —based, whereas the weights in step 2 are industry-based
Step IV: Multiply each factor’s weight by its rating to determine a weighted score for each variable
Step V: Sum the weighted scores for each variable to determine the total weighted score for the organization
1.6.1.2 External Factor Evaluation Matrix (EFE)
External Factor Evaluation Matrix (EFE) is a strategic tool used to summarize and evaluate external factors that affect a business, drawing on economic, social, cultural, demographic, environmental, political, governmental, legal, technological, and competitive information The EFE Matrix helps identify opportunities and threats in the external environment and provides a quantified view that informs strategic planning and decision making It can be developed in five steps, typically starting with listing key external factors, assigning weights to reflect their relative importance, rating each factor's impact, calculating the weighted scores, and summing them to arrive at an overall external factor score that guides strategy.
Step I: List key external factor as identified the external-audit process Include a total of 15 to 20 factors, including both opportunities and threats, that affect the firm and its industry
Step 2: Assign to each factor a weight that ranges from 0.0(not important) to 1.0 (very important) for each element The weight indicates the relative importance of that factor to being successful in the firm’s industry Opportunities often receive higher weights than threats, but threats can receive high weights if they are especially severe or threatening Appropriate weights can be determined by comparing successful with unsuccessful competitors or by discussing the factor and reaching a group consensus The sum of all weights assigned to the factor must equal 1.0
Step 3: Assign a rating between | and 4 to each key external factor to indicate how effectively the firm’s current strategies respond to the factor, where 4 the response is superior, 3> the response in above average 2= the response 1s average, and |= the response is poor Rating are based on effectiveness of the firm’s strategies Rating are thus company-based, whereas the weights in step 2 are industry —based It’s important to note that both threats and opportunities can receive a 1, 2, 3 or 4
Step 4: Multiply each factor’s weight by its rating to determine a weighted score
Step 5: Sum the weighted score for each variable to determine the total weighted score for the organization Regardless of key opportunities and threats included in an EFE matrix, the highest possible total weighted score for an organization is 4.0 and the lowest possible total weighted score in 1.0 the average total weighted score of 4.0 indicates that an organization is responding in an outstanding way to existing opportunities and threats in its industry A total score of 1.0 indicates that the firm’s strategies are not capitalizing on opportunities or avoiding external threats
1.6.1.3 The Competitive Profile Matrix (CPM)
The Competitive Profile Matrix (CPM) is a strategic tool that identifies a firm’s major competitors and assesses how its internal strengths and external pressures stack up against a sample firm’s strategic position Like the External Factor Evaluation (EFE), the CPM uses weights and a total weighted score, but its critical success factors encompass both internal and external issues, so ratings reflect strengths and weaknesses: 4 = major strength, 3 = minor strength, 2 = minor weakness, and 1 = major weakness CPM factors are not organized into opportunities and threats as in an EFE; instead, the focus is on ratings that yield total weighted scores for rival firms, which can be compared to the sample firm to provide actionable competitive and internal strategic insights.
1.6.2 The tools to build viable strategis
1.6.2.1 Matrix of strengths, weaknesses, opportunities, threats (SWOT)
SWOT Matrix is a key strategic tool that helps managers formulate four types of strategies: SO strategies that leverage strengths to capitalize on external opportunities; WO strategies that address weaknesses by leveraging external opportunities; ST strategies that use strengths to defend against external threats; and WT strategies that aim to reduce weaknesses and mitigate the impact of external threats By pairing internal capabilities with external factors, the SWOT matrix guides organizations to prioritize actions that maximize opportunities while minimizing risks.
According to Fred R David, to build the SWOT matrix, we go through eight steps:
Step I: List the firm’s key external opportunities
Step II: List the firm’s key external threats
Step III: List the firm’s key external strengths
Step IV: List the firm’s key external weaknesses
Step V: Match internal strengths with external opportunities and record the resultant SO strategies in the appropriate cell
Step VI: Match internal weaknesses with external opportunities and record the resultant WO strategies
Step VII: Match internal strengths with external threats and record the resultant ST strategies
Step VIII: Match internal weaknesses with external threats and record the resultant WT strategies
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3.1.1.8 The Company’s strategic orientation by 2017
We establish member companies that pursue creative, breakthrough initiatives by applying the world's most advanced technologies, with a core focus on three areas—distribution, production, and services—to drive innovation and deliver superior value.
Research and development of terminal products and equipment suitable to Vietnam’s markets in copyrighted own brands of companies
Construction and investment in Metro’s network infrastructure in Hanoi and HCM City and application for ISP exploitation
We will establish regional representative offices in technology development parks across China, Taiwan, and Korea and invest in personnel for product research and development and technology transfer This effort aims to build a core workforce with the capacity and technical expertise required to drive innovation and growth.
Deployment of terminal production and assembly in Vietnam, and links to the international markets
As we unveil our strategy, the company will capitalize on opportunities from the rapid growth of the information technology industry, supportive government policies for IT development, and Vietnam’s fast‑growing economy We will leverage a healthy financial structure and efficient capital use, along with quality products, strong sales services, and competitive pricing, to solidify our market position Our skilled, experienced workforce will drive growth and increase our sales revenue in the current market.
As releasing the strategy, the company may take advantages of its strengths on
With a healthy financial structure and efficient use of capital, the company delivers quality products and reliable sales services at reasonable prices while applying international-standard corporate management tools to leverage its competitive advantages The rapid growth of telecommunications and information technology, backed by government policies, creates diversified demand and a sizable potential market This favorable environment enables the company to develop and expand its telecom and IT markets, increase revenue and market share, and establish a solid foundation for stable, long-term development.
With a strong financial structure and efficient capital use, the company builds solid relationships with foreign partners and leverages a skilled, experienced workforce to negotiate and execute joint ventures that capitalize on emerging opportunities The telecommunications sector is advancing rapidly, driven by government policies that support information technology development, and Vietnam’s dynamic economic growth creates a largely potential market A stable political environment and a favorable foreign investment climate further enhance these opportunities, making Vietnam an attractive partner for joint ventures that can deliver success in the years ahead.
3.2.2 Group of S-T strategies: Strategy on product differentiations:
Gia Nguyen Equipment and Technology Investment concentrates on its core strengths: delivering high-quality products with reliable sales service at competitive prices; cultivating strong relationships with foreign partners; maintaining a vigorous R&D program; and operating an effective customer-care system By building strategic partnerships to introduce new and differentiated products under the Gia Nguyen brand, the company can seize market opportunities while defending against threats such as rapid technological change and shifting product lifecycles.
Section 63 analyzes the technology and infrastructure investment cycle, noting that illegal smuggling and fraudulent trading complicate market dynamics With consumer incomes remaining low and the economic crisis suppressing spending, demand for telecom products declines, impacting investment in telecom infrastructure.
3.2.3 Group of W-O strategies: Strategy on human resource development: (Combination of W2, W5 W6 + O1, O2, O03)
Because people are the central and decisive force behind the company’s future development, the organization should implement a realistic and feasible human resources development (HRD) strategy that strengthens capabilities, addresses weaknesses, and leverages opportunities offered by the external environment, enabling the company to stay resilient in today’s dynamic landscape and to unlock long-term growth opportunities.
3.2.4 Group of W-T strategies: Strategy on product differentiation:
To mitigate the high risk from rapid technological change and the cycles of technology and infrastructure investment, while addressing threats from smuggling and trading fraud and reliance on foreign-supplied products and components, the company should pursue product differentiation, overcome weaknesses due to low capital investment, expand a limited distribution system, and strengthen advertising and promotional activities, particularly as economic crises shrink demand for IT products.
3.3 SELECTION OF STRATEGIES — MATRIX QSPM
Base on SWOT matrix combine with CPM matrix above, the selection strategy as following below:
Table 6: A QSPM for GNC strategy
AS: Attractiveness Score TAS: Total Attractiveness Score
BEY FACTORS Weight penetration development venture
AS TAS AS_ TAS AS_ TAS Strengths
1 Healthy tinancial structure 0.07 4 028 3 021 1 0.07 effective capital use
2 Products with quality selling services are good 0.10 + 0.4 3 0.3 l 0.1 with reasonable price
3 Have good relationship with 0.07 2 014 3 021 4 028 foreign partners
4; Habor toree 1s relatively 0.09 4°36 3° 2007 4 0.09 skilled and experienced
5 Use professional business management tools reaching 0.09 3 027 #3 O27 2 0.18 international standards
6 System of customer care and construction of strategic 0.07 4 028 3 021L 2 014 customer relationship effectively
2 Mission on development 0.09 3 027 2 018 4 036 and research is weak
3 Distribution system is malted, mission on 0.08 4 032 3 024 1 0.08 advertisement and promotion is weak
4 Loss of balance in industrial 0.08 3 024 4 032 1 008 structure
5 Mission on recruitment and 0.07 > 014 I 0071 007 training Is weak
6„k¿aG 0i l0DE-KBIUN 0.10 1 O10 1 01 1 0.10 development strategies
AS TAS AS TAS’ AS-— TAS
I Development rate of information technology is very high
The governmental policies support development of telecom technology
Demands on telecom technology are plentiful and diversified
Environment of politics society is stable attracting foreign investment
Economic development rate of Vietnam is high
Rapid change in technologies technological life investment cycle of electronics infrastructure and large retail groups
1 Activities on smuggling and trading fraud are still complicated
Income of consumers still low
Subject on supply of foreign products and components
Financial and monetary policies change ceaselessly
Affects of economic crisis make the demands for using telecom products and services reduced
Through the analysis of matrix QSPM and based on the total attractive scores of strategies, we have following conclusions:
After evaluating strategic options, the market penetration strategy records the highest Total Attractiveness Score (TAS) of 6.09, ahead of the market development strategy at 5.05 and the joint venture strategy at 4.34 Consequently, the market penetration strategy is selected as the preferred path because its TAS is the largest.
Investment Technology and Equipment Gia Nguyen Co., Ltd aims to become a leading provider of telecom equipment and to compete effectively in today’s volatile market The company will pursue four core strategies to achieve this goal: market development to expand into new customer segments and regions; market penetration to grow our share in existing markets; human resource development to cultivate a skilled, high-performing workforce; and product differentiation to deliver telecom equipment solutions that stand out from competitors.
* For strategy on Market penetration:
* For strategy on Market penetration:
Company has so many customers as VNPT, Viettel, G-Tel,
Vietnammobile, VTC, Banks and Enterprises, so to choose the market penetration strategy is to raise the current market share for products and services of company
Our mission is to build a close relationship with customers by keeping them informed about the latest technology applications they will need, while delivering reliable maintenance and repair services and supporting their financial planning for investment or purchasing decisions We continuously innovate to meet the evolving needs and wants of all customers, providing practical, value-driven solutions We collaborate closely with manufacturers to secure competitive pricing, on-time delivery, and products that meet international quality standards, backed by a skilled team of technicians trained in Vietnam By aligning technology, service, and financing, we empower customers to invest with confidence and sustain long-term partnerships.
Our objective is to achieve an average annual growth rate of 15-20% In terms of revenue mix, service will contribute 30% of total revenue, accessories 5%, and equipment revenue 65% After-sales service will be a key driver of the business, and the service revenue will be the main financial source to fund training.
Investing in a state-of-the-art lab room to facilitate technology transfer and accelerate R&D activities, we diversify our product portfolio while improving quality and differentiating our offerings We focus on marketing solutions, product introductions, and seminars, and actively participate in telecom and IT trade fairs to showcase our products and capture customer demand in Hanoi, Ho Chi Minh City, and Da Nang.
Here are the specific measures to incorporate the four key strategies:
3.4.1 Solutions and development of human resource:
To implement the strategies selected above, preparing the human resource to meet development needs in the new situation is essential To implement the strategies, professional managers are required Experienced employees play important roles in GNC’s human resource development, which should be carried out through a structured program that coordinates management leadership, leverages the expertise of seasoned staff, and aligns development efforts with the company’s strategic goals.