Recommending business strategy for pqc from 2012 to 2016

Starting with Sinh Doi wedding restaurant and then the White Palace convention center, Phu Quy Corporation Company abbreviated as PQC is one of the pioneers business in the weddings and

Capstone Project Report

2012 TO 2016

GLOBAL ADVANCED

MASTER OF BUSINESS ADMINISTRATION

CAPSTONE PROJECT REPORT

RECOMMENDING BUSINESS STRATEGY OF PQC

FROM 2012 TO 2016

Members : Nguyen Tuan Son

Pham Quyet Tien Phan Phuc Hau Lai Hong Phu

Class: GaMBA.C0310

Ho Chi Minh City 2012

ACKNOWLEGMENT

Our group would like to express our thankfulness to the Directors and the Faculty from Center for Educational Technology and Career Development (ETC) – Vietnam National University; ETC’s Southern Division and Griggs University for having created us the best study conditions and have encouraged us in all the time

of research and writing this capstone

We have further more to thank the Directors of PQC JSC as well as its related Departments for their provided relevant information, data and their supports for our Capstone

We understand that due to our lack of experience and limited information, our Capstone would have some shortcomings However, we would really appreciate all comments and suggestions for improvement in order to make the Capstone become, somehow, more applicable and more meaningful to the current context of PQC JSC

Even though this Capstone is our first ever carried-out research, we know that what we learn from doing the research will help us a lot not only in our professions but also in our future academic pursuits, and we believe that all the theoretical and practical business strategies withdrawn from this Capstone will bring us success in our career

WORDS OF REASSURE

We affirm that the work of this Capstone is our own research and all the information and data used are true

HCM City, 11th April 2012

LISTS OF CONTENTS

ACKNOWLEGMENT …… … i

LISTS OF TABLES……… ………ii

LISTS OF FIGURES iii

INTRODUCTION 2

1 THE NECESSITY OF TOPIC 2

1.1THE REASON WHY TO CHOOSE THE TOPIC 2

1.2 RESEARCH OBJECTIVES 3

1.3 OBJECT AND SCOPE OF THE RESEARCH: 3

2 RESEARCH METHODS: 3

3 TOPIC STRUCTURE: 3

CHAPTER 1 - OVERVIEW OF THE THEORY OF STRATEGIC MANAGEMENT OF WEDDING AND CONVENTION AND THE PRACTICAL REQUIREMENTS OF THE REPORT 4

1.1 G ENERAL THEORY OF STRATEGIC MANAGEMENT OF WEDDING AND CONVENTION 4

1.1.1 Definition of hospitality industry: 4

1.1.2 The role of strategic management: 5

1.1.3 Strategic planning process: 5

1.1.4 Classification of strategy: 5

1.1.5 The theory of service: 6

1.1.6 The tools and methods of strategic planning: 9

1.2OVERVIEW OF THE SERVICE SECTOR OF THE PQC 12

1.2.1 Business Situation 12

1.2.2 The advantages of PQC Company 13

1.2.3 The disadvantages of PQC Company 14

1.2.4 The question for PQC Company 14

1.3THE NECESSITY OF STRATEGIC PLANNING FOR PQCCOMPANY 15

CHAPTER 2 - ANALYZING AND EVALUATING THE REAL SITUATION OF PQC COMPANY 15

2.1 INTRODUCTION TO THE COMPANY 15

2.1.1 An overview 15

2.1.2 Business Scope - Goods and services 17

2.1.2.2) Characteristics of products & services provided 19

2.1.3 The organization structure 21

2.1.4 The current clients and partners 23

2.1.5 Business results during 3 years 2009, 2010, 2011 and plans to 2012 25

2.2 ANALYSIS OF INTERNAL ENVIRONMENT WITHIN PQC 30

2.2.1 Production 30

2.2.2 Marketing 33

2.2.3 Human resource management 33

2.2.4 Finance- Accounting 35

2.2.5 Research and development 35

2.3THE ANALYSIS OF THE IMPACT OF THE EXTERNAL FACTORS 35

2.3.1 The analysis of macro environment of hospitality industry 35

2.3.2 The analysis of competitors 36

2.4 MATRIX OF STRATEGIC SELECTION 42

2.4.1 External Factor Evaluation matrix(EFE) 42

2.4.2 CPM Matrix 43

2.4.3 Internal Factor Evaluation matrix (IFE) 45

2.4.3 SWOT matrix 46

2.4.5 Space matrix 48

2.4.6 QSPM matrix 50

2.5 OUR GROUP GIVE GENERAL COMMENT ABOUT PQC COMPANY THROUGH THE ABOVE MODEL 52

2.5.1 Organizational structure 52

2.5.2 Business operation 53

CHAPTER 3: BUSINESS DEVELOPMENT STRATEGY IN THE PERIOD OF 2012-2016 IN PQC 56

3.1 O RIENTATION AND FACTOR FOR SELECTION : 56

3.1.1 Orientations of industry development 56

3.1.2 Foundation for selection of strategic development 59

3.2 T HE OBJECTIVES OF PQC IN THE PERIOD OF 2012-2016 60

3.2.1 Non-current objective until 2016 60

3.2.2 The objectives for each year from 2012 to 2016 61

3.3 M EASURES OF STRATEGIC IMPLEMENTATION 61

3.3.1 Restructuring of strategic implementation 62

3.3.2 Implementation of strategies after restructuring: 63

3.3.2.1 Strategy of supporting industries 64

3.2.2.2 Brand strategy 66

3.3.2.3.Market development: 70

3.2.2.4 Human resource management 71

3.2.2.5.Capital development 72

LISTS OF TABLES

Table 2.3: Business results – source from the PQC 21 Table 2.4: Price comparison of competitors– source from the PQC 22 Table 2.5: Price comparison of competitors– source from PQC 23 Table 2.6 : Price policies in 2012, source from the PQC 24 Table 2.7: Business targets in 2012 – source from the PQC 24 Table 2.8: the evaluation of 3 stars market – PQC source 31 Table 2.9: The evaluation of ≥ 4 star market– PQC source 32 Table 2.10: strength and weakness of opponents – PQC source 33 Table 2.11: Capacity of market supply – PQC source 35

Table 2.14: The analysis of Internal Factor Evaluation matrix 39

Table 2.17: Matrix table of quantity strategic plan 44

LISTS OF FIGURES

Fig 2.7: Cultural diplomacy of French consulate – PQC source 19 Fig 2.8: Cultural diplomacy of Australia consulate – PQC source 19

Fig 2.10: The issue of style magazine 2010 – PQC source 20

INTRODUCTION

1 The necessity of topic

1.1 The reason why to choose the topic

Banquet business services in weddings-conferences business is vibrant, attractive and is always a profitable industry despite the crisis or the economic difficulties In the name of love, the wedding was conceived as event of life of people; it is the proudest social caste of whole family with friends and relatives So people are willing to pay generously to organize the wedding that is the most spectacular, most impressive and luxurious

The conferences-weddings business, in essence, can be seen as a form of wholesalers in the catering business, but it can be sold at high prices as it is accompanied by the service, and may be active in ingredients, portions so the profit rate is high The attractiveness and high profitability will usually come with very strong competition, which requires enterprises to constantly innovate, create and pay fine attention to their products, their services to survive and develop

Starting with Sinh Doi wedding restaurant and then the White Palace convention center, Phu Quy Corporation Company (abbreviated as PQC) is one of the pioneers business in the weddings and conferences industry that is relatively young in Vietnam The company PQC has built a strong brand name and is always the first choice of partners, customers

However, due to the level of increasingly stronger competition that not only from rivals of professional business in conferences and weddings, such as: Diamond Palace, Royal Gala, Callary, Grand Palace but also from the high class hotel of wedding –conferences at the same segment with 2 brands of PQC (White Palace convention center and Sinh Doi Restaurant) such as: Movenpick, Park Royal, Rex, Equatorial And rivals with higher levels (Park Hyatt, Sheraton) who join the lower segment The other potential competitor with the ability of

and market share of PQC in the industry threatened Thus, PQC needs better strategy to maintain its position and continue to grow stronger in the future

For that reason, our group has chosen the topic " Recommending business

strategy for PQC from 2012-2016 " as a research project of our group

We hope that the jury members, Council Capstone Project Reports of Class and other GaMBA.C0310 classmates will support our team with suggestions, comments to the project reports to be more persuasive and feasible

1.2 Research objectives

Report focuses on research following issues:

• Basic theory of business strategy

• Status of business in PQC

• Proposing appropriate measures to establish the development strategy

of PQC

1.3 Object and scope of the research:

Reporting research project concentrated on strategic activities for conferences-weddings business of the PQC and proposing solutions and suggestions

 Chapter 1: Overview of the theory of strategic management of wedding and

convention, and the practical requirements of the report

 Chapter 2: Analysis and evaluation of the status of the activities of PQC

1.1 General theory of strategic management of wedding and convention

1.1.1 Definition of hospitality industry:

The “hospitality industry” consists of broad category of fields within the

service industry that includes lodging, restaurants, event planning, theme parks, transportation, cruise line, and additional fields within the tourism industry The hospitality industry is a several billion dollar industry that mostly depends on the availability of leisure time and disposable income A hospitality unit such as a restaurant, hotel, or even an amusement park consists of multiple groups such as facility maintenance, direct operations (servers, housekeepers, porters, kitchen

workers, bartenders, etc.), management, marketing, and human resources

The hospitality industry covers a wide range of organizations offering food service and accommodation The industry is divided into sectors according to the skill-sets required for the work involved Sectors include accommodation, food and beverage, meeting and events, wedding, gaming, entertainment and recreation, tourism services, and visitor information

Strategic Management can be defined as an art and science of establishment, implementation and evaluation of decisions concerning many functions that allow

an organization to achieve those objectives

1.1.2 The role of strategic management:

"A national, an organization without a strategy is like a ship without rudder that would not know where to go"

Strategic management oriented for the development of business in the long term, to achieve the objectives

In internal affair of business, strategic management helps to facilitate decision making which unify and coordinate the smooth, flexible activities

In the business environment conditions are changing and complicating; management strategy activities always help administrators proactively before the changes of the environment, harnessing the opportunities, and reduce the threat Then the manager can propose the solutions, target to adapt with the environment

1.1.3 Strategic planning process:

Consisting of 5 steps: Establishing the objectives, estimating current position, setting and selecting strategies, implementing strategies, evaluating and controlling strategy, implementing plan

1.1.4 Classification of strategy:

According to the different approaches, that will have different strategies: Company strategy level: integrated strategy group (front combination, rear combination, horizontal combination; intensive strategy groups (market penetration, market development, product development ) other strategic groups (joint venture, mixed strategy ) Strategic business unit level: strategy of product differentiation

Functions strategic level: marketing strategies, finance strategies, human resource strategies

1.1.5 The theory of service:

a / Definition:

Service is a process of backstage activities and other front activities where customers and service providers interact with each other, thereby to satisfy needs and wants as well as create value for customers

b / Characteristics of the service:

Service usually has specific characteristics that distinguish the different kinds of tangible goods Services often have the following characteristics

b.1 - Invisibility:

The intangible nature of services is not to touch or grasp and services do not have specifically shape as products The experience of customer service usually consists of a sequence of activities Each activity represents an organization providing services to customers So basically the service provider is the implementation, which it opposed to physical products of tangible capital

b.2 - The inseparability (production and consumption at the same time):

The inseparability from the service here is talking about the difficulty of distinguishing between a service creation and use of services as two separate jobs or two separate processes

A service cannot be separated into two phases: forming phase and use phase The creation and use of most services will occur simultaneously Goods and services are not the same Goods are produced first and then put into the warehouse, sale and use As services are created and used throughout the process of creating such services

b.3 - Heterogeneity:

Heterogeneity here is the difference of the level of service performance It means that services can be ranked from very poor to excellent service Heterogeneity associated with high variability in the implementation of services The essential problem of a service may vary depending on the service, customers

and time Basically, variations in service also likely occur and occur more frequently than non-conformity of organic products because of the service level with high human interaction This feature makes the standardized services become

b.4 - The nature is not stored:

The service cannot be stored and then retrieved for using A service will disappear if we do not use it We cannot store services, so a service cannot be produced or left in stock and then sold When a service is done, not a part of the service can be restored To reduce the influence of unsorted service, people are trying to sell the service at its highest level

b.5 - Selecting the service is bound by client:

Customers and employees must close together to implement the service Therefore business locations must close to customers

c - The strategy in the competitive service:

c.1 – The value models of the service:

A management philosophy of perfect service represented by triangle service The three corners of this triangle are: service strategy, staff and organizational systems The intersection point and the center of the triangle is the customer The heart of the triangle is the customer "know your customer" is critical to any organization (before the customer is satisfied, the enterprise must clearly know what

Strategy

Staff

System

Customer

So the strategy development based on customer, this strategy focuses on customers and lead to organizational commitment From the knowledge of understanding of customers, we can develop two key elements of service strategies:

(1) Concentrating on the inside-the organization's commitment to service (2) Concentrating on the outside-the promise of our service to customer

c.2 - The strategy of the organization:

Common-objectives

(Level 1: Director)

Analysis of the objective

in the proposed strategy

Developing strategy and planning of the business strategy

Objectives

( Level 2: Strategic

Activity)

Identification-of priority

Analyzing and strategy

setting and strategy

and strategy

The process of strategic planning “above-under”

Above – under process Under - above process

Mission, general objectives,

constraints (facilities, resources)

Strategy and common objective

Strategic-activities

(Division, department)

Objectives, strategic, activities (Division, department)

c.3 - Models of competitive service strategy:

1.1.6 The tools and methods of strategic planning:

a) Sector analysis: matrix evaluation of external factors (EFE):

- EFE Matrix was built in five steps:

Listing the elements: collect a list of external factors; divide the elements into two groups: Opportunities and threats

Specifying a task for each element, the value of each task should be divided between 0 and 1.0, 0 means the factor is not important 1.0 is very important The total value of the task is equal to 1.0

An evaluation for each factor, an evaluation should be divided between 1 and 4 The rating shows how effective current strategy of the business response elements

1 = low response, 2 = below average response, 3 = above average, 4 = high

Multiplying each element with each assessment task, this will calculate the recorded elements

Plus all the tasks for each element, this will calculate the total score for business

This matrix shows a clear picture of the strengths and weaknesses of the business relative to the competitors in the same industry

This matrix is an extension of the EFE Matrix task for each element, the meaning of each task and total number of tasks

c) Analysis of sector: matrix of inside factor evaluation (IFE)

- Matrix IEF was established by the five steps:

Listing from 10 to 20 factors, including the strengths and weaknesses affecting the business

Classification of the importance of each factor based on a scale of 0.0 - 1.0

Identifying the importance of each factor based on the scale of 1-4

Multiplying the importance of each element with its evaluation of score

Sum of points for each factor to the total number of points on the importance

If the total importance of the matrix is less than 2.5: Enterprises with weak internal factors and on the contrary, if the total importance of the matrix is above 2.5: enterprises with powerful internal factors

d) Matrix with strengths - weaknesses, opportunities - threats (SWOT)

SWOT Matrix is a tool that combines the strengths (S), weaknesses (W), Opportunities (O) and threats (T) to make four different strategies as follows:

To set the SWOT Matrix, the administrator must go through eight (8) steps:

 Step 1: List all the opportunities from the external environment (O1, O2 )



 Step 3: List all the strengths of the company (S1, S2 )

 Step 4: List all the weaknesses of the company (W1, W2 )

 Step 5: Combine the strengths and opportunities (SO)

 Step 6: Combine the weakness and opportunity (WO)

 Step 7: Combine the strengths and threats (ST)

 Step 8: Combine Weaknesses and Threats (WT)

e) The matrix of strategic position and action evaluation (SPACE dimensional analysis)

4-SPACE matrix shows that business strategy should choose: Attack, conservative, defensive, or competitive The axes have the following meanings:

 FS: The financial strength of enterprise

 CA: The competitive advantage of enterprise

 ES: The stability of the environment

 IS: The strength of Industry to establish a SPACE matrix, we need to perform the following steps:

Step 1: Choose a set of variables was evaluated using a competitive advantage

(CA), industry strength (IS), environmental stability (ES), and financial strength (FS)

Step 2: Evaluate the individual elements using the evaluation system specifically

for each dimension Assess the competitive advantage (CA) and environmental stability (ES) using a rating scale from 6 (worst) to 1 (best) Evaluating industry strength (IS) and financial strength (FS) using the rating scale from +1 (worst) to +6 (best)

Step 3: Find the average score for competitive advantage (CA), industry strength

(IS), environmental stability (ES), and financial strength (FS)

Step 4: Draw the graph from step 3 for each dimension on SPACE matrix with the

appropriate axis

Step 5: Add the average score for the size of competitive advantage (CA), industrial

strength (IS) That will be your last point on the axis X of SPACE matrix

Step 6: Add the average score for SPACE matrix about the dimension of

environmental stability (ES), and financial strength (FS) to find your last point on the axis Y

Step 7: Find the intersection of X and Y Draw a line from the center of the SPACE

matrix to your point This line indicates the type of company strategy to pursue

f) Quantifiable strategic planning matrix (QSPM)

The matrix used for rating the feasible strategic plan, so we have a platform

to choose the best strategy

This matrix uses all the inputs from all development matrixes (EFE & IFE Matrix, matrix picture competition, SWOT matrix, SPACE matrix) The core of the important factors ranked from 1 to 4 4: very important, 3 important, 2 fairly important, 1: unimportant

Attractions in each strategy given a rating scale from 1 to 4; 1: completely unattractive, 2: less attractive, 3: quite attractive, 4: very attractive A success factor affecting the choice of strategy is no point

1.2 Overview of the service sector of the PQC

employees able to serve nearly 10,000 guests per day The annual revenue and profit of PQC company growth sustainably and strongly Revenues in 2010 reached

291 billion VND and a profit reached 65 billion VND Revenues in 2011 reached

385 billion VND, profit reached 86 billion VND Overall, wedding and conference business is still one of the most exciting activities with the continuous project that is built and put into exploitation from 2000 to present (De Nhat restaurant, Phong Lan, Dong Ho, Cung Hy…) besides, the premium segment of the wedding market is a race with new rivals such as Gala Royal, Callary, Grand Palace Diamond Palace, Riverside Palace……

1.2.2 The advantages of PQC Company

- PQC has long-term operations in wedding party & convention business, with famous trade mark in the field

- White Palace provides the largest floor area of 8,000 square meters and pillar less ballrooms in HCM city, there are two grand ballrooms of more than 3,000 square meters It is suitable for large scale convention and event for conferences-weddings business, the grand ballrooms can be decided into five section with movable partition

- The management team and staff are professionally trained

- The results of business activities in all years are growth and sustainability Profits increased and accrued annually The financial situation is explicit

- Many multinational companies in the world of hotel-restaurant sector concerned and questioned to cooperate together

- The segment of potential customer strong growth including quantity and quality Due to mechanical and biological population increase in HCM City the number of intellectuals and young professionals significantly increased in recent years

- The corporation, domestic and foreign companies investing and setting up headquarters in Ho Chi Minh City are increasing, Therefore the need of organizing some important events is also frequently increasing

1.2.3 The disadvantages of PQC Company

- The big-name opponents participate more deeply in the sector of providing conference - banquet service such as Gala Royal, Callary, Grand Palace Diamond Palace, Riverside Palace

- In the short term, the domestic and foreign economies are difficult due to the storm of global economic recession

- The organizational structure is no longer suitable for the new environment

- The ground is big enough to expand the Company's business network but currently has many limitations, the land fund for the center of Ho Chi Minh City is exhausted

- The quality of the training schools and the training centers for hotel restaurants are limited, so they cannot meet the requirements of the Company Annually, the Company has to train dozens of former and new employees to improve the quality customer service

- The current food supply market meets many difficulties on food safety issues

- Customers are more increasingly critical in choosing the wedding and conference events

1.2.4 The question for PQC Company

- Restructuring the company's operations to suit the new business environment

- Developing the supporting industries for banquet-conference businesses: For establishing the subsidiary to specialize in each area activities such as the corporation of training and human resource management; providing food sources

- Looking for potential foreign partners and brand to expand business activities

- Expanding the network of restaurants in Ho Chi Minh City and several large cities in the country to improve competitiveness

1.3 The necessity of strategic planning for PQC Company

Currently, the brand and the financial ability of PQC Company are strong enough and they can compete with any competitor in the market Enterprise size is more increasingly; the business areas are increasingly intense competition requiring PQC Company to have specific and long-term business strategy Therefore, the strategic planning is really necessary and it demonstrates the professionalism in business, the success or failure in the future of business depending primarily on the business strategy of the company

Chapter 2 - Analyzing and evaluating the real situation of PQC Company 2.1 Introduction to the company

Fig 1.2: logo of PQC

• Business scope: business in hospitality industry feasting specializes (wedding) and events, conferences and workshops together with catering services

• History of establishment and development:

Starting business with Sinh Doi wedding center in 1997 (address 120 Ly Thai To Street, District 3, HCMC), PQC company has been very successful in running a large and the most luxurious wedding reception center, and it is considered as "the pioneer" in the wedding technology sector in Ho Chi Minh City

Referring to Sinh Doi Wedding center is to mention the quality, service scale and reputation for customer when placing the wedding here Sinh Doi wedding center is located in the convenient business area; its scale includes five banquet halls with a different area It will be arranged with the number of tables that is suitable to customer needs Sinh Doi’s Banquet hall were luxuriously decorated with the suitable space observing the entire stage, sound system, lighting quality to ensure customer's perfect wedding Sinh Doi wedding service was designed in the package, and varied to meet the needs of each client setting the party Sinh Doi is the pioneer company when putting photos of the wedding guests and family friends after the party organization on Sinh Doi’s website

Continuing these successes, in 2007 PQC Company expanded a new White Palace Convention Center (address: 194 Hoang Van Thu, Phu Nhuan District, HCM City) which is a venue for holding parties , the largest conference in the city and quickly became a successful venue for many events of large company, the famous multinational company

2.1.2 Business Scope - Goods and services

2.1.2.1) Products and services of PQC:

- Banquet & party business:

Fig 2.1 banquet - PQC source

- Organizing high-level events, conventions, conferences, seminars, …

- Picnic catering services

2.1.2.2) Characteristics of products & services provided

- Banquet & party catering services:

Requisites of banquet & party catering services:

 Good and professional customer care (before and after the provision

of the catering services) Particularly, emphasis is put on pre-catering care by information exploring, and exploiting upon the party reservation by customers, for classifying their needs and then providing them with our advice, right at the beginning

 Solemn premises and favorable location for banquet catering

 Standard sound, lighting systems and equipment

 Professional teams of cooks and managerial staff for high-quality banquet catering

 Standard and diverse catering factors which can meet all the customers’ needs

 Providing attendant services: MCs, receptionists, wedding ceremony program (traditional, modern-styled, …) upon customers’ request…, fresh flower decorations, filming, photo taking, Rolls-Royce for hire, after-party gifts to guests, later access to party pictures via website address, after-wedding gifts to the married couple, customer service

on wedding anniversaries … Customers will be received heartily and thoughtfully in impressive spaces and the professional banquet catering by PQC at its two venues of Sinh Doi and White Palace PQC has established a customer care procedure prior to the service provision, whereby inquiring customers will be provided with detailed information

on party prices, catering conditions, and customer gratitude programs, when they

contact PQC’s information desks at Sinh Doi and White Palace Via the customer care procedure, PQC already classifies their needs at the time of their consulting

PQC’s banquet halls at Sinh Doi and White Palace are splendidly decorated, with reasonable space for every attending guest to observe the whole stage Their high-grade sound and lighting systems provide the two families, their relatives, and guests with a solemn, pleasant and comfortable setting

- Services of holding events (conferences, conventions, seminars …):

Requisites of providing event holding services:

 Good and professional customer care (before and after the provision

of the event holding services)

 The premises to hold the event is large and solemn enough, in favorable location

 Sound, and lighting systems can meet high requirements, flexible, and suitable to each event held

 Professional staff involved to manage and hold the event

 Attendant services: receive the event participants, provide decorative services, serve tea and cakes for breaks, lunch party, evening party, cocktail party, theme party, and others, on the event holding customer’s request

PQC can meet all the said requisites in its activities of event holding service provision, and render good services to customers’ needs, as a regular organizer of large events in Ho Chi Minh City Its White Palace is favorably located, with most sophisticated design for large-scale events All the halls are installed with modern equipment systems, flexible lighting systems, wireless Internet, high and airy ceilings to make the held event more magnificent; and large halls without columns

to suit any event characteristics White Palace can be arranged with layout suitable

to customers’ diverse needs of event holding:

 Hold events with required small tables (each for 5 to 6 guests)

 Hold events as classes, conventions, seminars, round-table, table, U-table conventions, theatre…

square- Hold events with required round-table party

 Provide such attendant services as: serving tea and cakes for breaks, lunch party, evening party, cocktail party, theme party

2.1.3 The organization structure

Fig 2.4 PQC’s organization structure- PQC source

* Comments:

The current organizational structure of PQC company are organized in each block and all blocks are supporting the business activities of the PQC that is a

Managing Board Supervisor Board Board of Directors

Marketing Division Sales Division

Communicate and foreign relation Division

Hotel Operation

Commercial centre Operation Foods Operation

Sweet foods and drinks Operation

- Administration HR Block: the main task is to provide training and coaching

personnel of PQC, ensuring the quality of human resources In addition, the administrative HR coordinates with other building blocks of business processes, business regulation

- The investment-finance-accounting Block: accounting tasks including

management and financial accounting Management accounting is use for the management and administration Financial accounting implemented in accordance with state agencies

- Business - marketing - communications Block: the main task is to

investigate the market research and competitor, build and develop brands through 2 brand name of Sinh Doi & White Palace

- Operations Block: the primary tasks of the organization and operation of the

conference events-weddings through 2 brand name of Sinh Doi & White Palace, ranging from material concerns (domestic raw materials and ingredients imported from abroad), food processing and serving on the conference wedding- events

In all blocks of business, administration -investment - finance-accounting block with complementary of business activities Head of each block has a block manager

In terms of less number of personnel and business operation, PQC Company also focus on conferences-weddings business (Hospitality/Convention) The central management block for each array is to promote its advantages

2.1.4 The current clients and partners

Fig 2.7 Cultural diplomacy of French Consulate- PQC source

Fig 2.10: The issue of style magazine 2010 - PQC source

2.1.5 Business results during 3 years 2009, 2010, 2011 and plans to 2012

Banquet (wedding party) Person 171,289 184,630 198,871

Table 2.3: Business results – source from the PQC

2.1.5.1) Assessment of business results

PQC has three major business lines: picnic party catering services (outdoor parties); corporate party catering services (meetings, seminars, events .), and wedding party (banquet) business During the past years, wedding party business has accounted for the highest rate (60%) in total revenues of PQC However, the growth rate of revenues from wedding party business has been not high, hence the low growth rate of PQC’s total revenues through the years

Reason: Vietnamese people, especially the residents in Ho Chi Minh City have the habit of holding their wedding parties in weekend evenings, or lucky day evenings (as per Lunar year) As shown by PQC’s statistics, there were nearly 3,000 customers who yearly contacted and needed to hold their wedding parties at White Palace and Sinh Doi, but PQC could satisfy only about 1/3 of these customers (PQC provided about 900 parties) because the number of weekends and lucky days in each year was limited Normally, customers had to sign contracts and pay deposit to PQC about 6-9 months in advance when holding wedding parties This is really a barrier hardly to be overcome for PQC’s proceeds from wedding parties to be

increased However, this difficulty will become good opportunity if PQC can affect and change its customers’ habit, step by step, to exploit the capacity of wedding party business during the weekdays and noontime

PQC’s revenues from corporate party business, and picnic party business through the years has accounted for lower rate (in average 40% of total revenues), but this has very good potential of growth because the needs of holding meetings, seminars, events, … by corporate customers would be certainly increased after the economy has passed its period of difficulty and crisis from 2008 to present, and restored its growth rate The results of PQC’s corporate party business, and picnic party business for the past years have been its difference and strengths compared with a number of its opponents in the same segment, because they could not attract the said customers

2.1.5.2) Development of business plans in 2012:

Planning the selling prices and services:

Through research, survey of competitors’ prices, we will predict prices of White Palace 's wedding parties next year to locate and bring actual efficiency to sales in 2012

a/ 1st quarter – Feb/2012 - (Floor prices shall be offered for sale)

Table 2.4: Price comparison of competitors– source from the PQC

Rivals Average selling price % revenue % difference

b/3rd-4th quarters / 2012 - (Floor prices shall be offered for sale)

Table 2.5: Price comparison of competitors– source from PQC

Rivals Average selling price % revenue % difference

Conclusion: Thus we can see that, compared with 2011, in 2012, the average

market price has increased 10%, as usual, it shall increase up 5% to 10% in the peak season of the late year In 2012, the PQC shall maintain a safe distance from 15% to 20% with competitors by the price policies and the innovation in its product and service package

Price policies of the PQC in 2012:

Table 2.7: Business targets in 2012 – source from the PQC

Profit before tax 34,723,030 30% 97,606,038 30% 132,329,068 30%

2.2 Analysis of internal environment within PQC

2.2.1 Production

The PQC products are very diverse and rich, mainstream of dishes and

services at the White Palace and Sinh Doi are characterized by the European style

SELLING PRICES

2012

SELLING PRICES

Fig 2.11 appetizers – source from the PQC

Fig.2.12: XO beef – source from the PQC

Fig.2.13: Sichuan seabass – source the from PQC

Fig 2.14: Shrimps rolled Bacon– source from the PQC

Fig.2.15: specific and luxury style of Desserts

2.2.2 Marketing

PQC company costs a lot of expenses for bulding up the brand (White Palace and SINH DOI (TWINS)), PQC company focuses on creating White Palace as a poweful brand of Vietnamin in particular and in the area in general White Palace promotes its own brand to customers via newspaper, radio, charity activities, sponsor program, etc White Palace also promotes its brand by participating in fairs, trade promotion activities held by Tourism and Vietnam Association of Entrepreneurs From 1999 to 2011, White Palace continuously received the high quality Vietnamese brand; White Palace also received the Certificate of Vietnamese record: unit has the largest banquet

2.2.3 Human resource management

The number of employees in PQC company is stable over years with the total

of 1.187 employees, in which there are 3 employees (0,3%) with postgraduate degree, 85 employees (7,7%) with graduate degree, 1.099 employees (92%) with high school degree and basic courses of hospitality Research and Development Division has 5 employees with specialist hospitality university degree- trained in Sweden

o Recruitment and training policy:

PQC expresses the careful concern when it train the cadre, improve especially the knowledge and skills of management for management cadre, specialist skills, professional skills for service staff and employees in the chicken

PQC has a regular synthonization and evaluation to hold following courses

as well as consider the efficient of means and methods to improve through the training and actual business operation of division staff PQC made the evaluation system of business performance and have more concern about the propaganda and dissemination of the culture and organization

PQC bring opportunity of time and working environment out for the employees to develop The operation in service industry, PQC determined that the best valuable assets of the company are the stability and quality of staff

Remuneration, benefit and insurance policy:

Remuneration policy is designed in accordance with the nature of work, the skill of the employees and consistent with the financial situation of PQC company, ensure the labor right under rules of the law Based on the overall business result, PQC continues to remain the bonus rate from 2 to 6 months’ salary for employees

on occasion of Independent Day and Lunar New Year Traditionally, PQC company organized the vacation in domestic as well as international country (combine with research and learning) depending on the achievement and position Our original cultural characteristic is to remain the extracurricular activities The average salary

of the PQC’s employees in 2011 is 4.700.000 dong/person/month which is higher than other company in the same business The sate of “brain drain” in hospitality became a top concern for the big majority of companies specializing in party and event organization in Vietnam That real situation placed a great challenge to train and maintain activities However, PQC still keeps the staff stable with long-term labor contract over the past years It proved the efficient of Human Resource Management of the Company, and this is an advantage to maintain, upgrade and increasingly improve the service quality of PQC company compared to other opponents in the same industry based on the seasonal labor force