Strategy for the quality improvement of the service supply in the Vietnam Mobile telecom Service Company in the period 2011-2015

re Le GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM ụ sRIGGS NIVERSITY Website: www.griggs edu vn Email: gamba@griggs edu.vn GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF

re Le GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM

ụ sRIGGS NIVERSITY Website: www.griggs edu vn Email: gamba@griggs edu.vn

GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM

CAPSTONE PROJECT REPORT

STRATERY FOR THE QUALITY IMPROVEMENT OF THE SERVICE SUPPLY IN VIETNAM MOBILE

TELECOM SERVICES COMPANY IN THE PERIOD

2 Mr Phan Quoc Anh

3 Mr Nguyen Thanh Chung

4 Mr Nguyen Phu Loc

5 Mr Tran Nam Phong

Mr Tran Van Tuyet

GLOBAL £¿ 2VANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM

Website: www.griggs edu vn Email: gamba@griggs edu.vn

OCA SALTER IEEE AT IIE ARIES i c Ÿ 22000008 ogy coe asa la ie ORT creat

` THANKS

Firstly, we'd like to thanks The Board of Directors

of = Center for Educationnal Technology and Career

Griggs University, USA, has provided education in Vietnam

with conditions for us to to study and complete Global

Advanced Master Of Business Administration Program

We'd like to thank sincerely and profoundly to the lecturers who teach enthusiastically, wholeheartedly to impart knowledge and enthusiastically guide our group to complete this capstone project report, enabling us to complete this course as well

Our group would like to give the deep thank our

colleagues, the Director Board of Viietnam Mobile Telecom Services Company, class management board and

GaMBA01.C0210 class members have helped encouraged and supported for our group to complete well

the study program and this capstone project report

Ho Chi Minh City, October 2011

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TABLE OF CONTENTS

LIST OIE TA B.LEẺ 5 G5 G50 0 cọ 0 1000380881156 8 LIST OF EIGUIRES G0 HH nọ nọ 000 008 g8 9 INTRODUCTION Go HH ng 000088009 880896 10

2 Research ư0bjJ€CẨÏVS: Q0 ọ ọ c 0000009108685888856 II

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CHAPTER 1: THEORETIC BASIS ON STRATEGIC MANAGEMENT IN BUSINESS AND SERVICE BUSINESS wesscscssssssossscscnennsssoncsossssssssvencvesssesavaresenes 13

1.1 Theoretic basis on strafegic manaØ©Im€TI( so 1 311 895555556 13 1.1.1 Concept of strategic management co < ss s2 S95555 1655555555 13

1,1,2 Strategy Classification scssscsssascssnsavinassssennenesesassesmarmannamanenneanes 14

LdedeD StvGte git LEVIS? sccscncsawssssxseasiesaoannenaanimsneamenissaisiwennassasnaereeuss 14 Ldded TS Oƒ NỈPHÍGBTPTÏ curaediantidiniditiniintiiekioHIASIGENGDEAEOEEKKIGSHESHEHENSHIOTEESRSS0E 15

1.1.3 Strategic managemenf DFOC€SS GS SH Y9 119518856885856 16

L13.1 Strategic planning PHOS? ssssiscvesecccversssvacsveassessvanacaucscorsnesssevancessnennsss 17 I.I.3.2 Strafegic irpleri€HfdfiOF DÏ1(1S€ 5 G5 < << S91 91 s2 27 1.1.3.3 Stratepic ứØVHlNHHÍGH DÍHSE oeeaaaaasexoeiedeniitniiatbiaxaotsnioEEE0NKR6NESS6A00503408x6 28 1.1.4 Theory on cus(omer S€FVÍC€ co 000 9 0 000695.56666995566856 28 1.1.4.1 H Túf ÌS CHSIOTHEF S€PUCÊP toonsnniannntinsdiiitiiididatdiSastiitsaliEdE806612ã3665654i05566bã 28 1.1.4.2 CharacteristiCS 0 CuSfOmeF S€FVĨC€ QG cĩ 11 99556 28 1.1.4.3 ImDOF[qHC€ OƒCHSÍOHICF SCFVỈCC SG Y5 088555585550885 6 29 1.1.S 7P Services Marketing ModelÌ: - -c- s11 1955 5555555555 30

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12,1 CGHRE€EBDÍR1ssseanardnddnudiiitretLrrdiinuidiitoilgtskgvtDO018SADni9dSESSaBiGI0GE01980300Vã00084168 30 1.2.2 Components of mobile teleeommunications serVÏC€: « 31 1.3 Necessity must plan the quality improvement strategy of providing the services at Vietnam Mobile Teleeom Services Company: .« 32 13.1 CiiStOmer SOPVICE wits isa sssccs coca sstensaaisnncantestbscasndinnsosntscotsxnnoncareranessonsncens 32

Tu bu COMCEPISE ss scasaccs vessams casita ceinionaniansndsadhiadtacdnsicenieasienssessenesrsesereoneeennsenen 32 1.3.1.2 Three basic pillars of customer safiSƒACfOH [SSHS: «.<<<<<< 33

the necessity has te plan the strategy to improve the quality of service supply in Vietnam Mobile Telecom Services Company 33

CHAPTER 2: ACTUAL SITUATION ANALYSIS OF BUSINESS AND

SERVICES OPERATION IN VIETNAM MOBILE TELECOM SERVICES COMPANY IN THE PERIOD 2006 — 2010 36

2.1.2 Process of formation and development .ccssssccccesssrccessseecesees 37 2.1.3 Achievements in recent V©ATFS: G000 00 03050060695 55.8 37

2.2 Organizational Structure cissenisssssscarssosssssvensvesnvesvsssexsssonsssnssaeunsevesesenesis 39

2.2.2 Functions and duties of the departments and boards 4I 2.3 Business Tế Ú nxeseseeenendeebartionirtodbidgspoiDCERDEA0005400800080001680005400041 0950040400000030666 48

information services of Vietnam Mobile Telecom Services Company in the Period 2006 — ZOOS csscccssnecsueseensnesesnsnsarsamsanmnaanenemeneencene ennieuneecsesnanmassteessersnenaa 49

2.4.1.1 Products oƒ Vietnam mobile Telecom SerViC€S COHIDđHV 49

2412 BHHšÌNHGSS TNHGEĂÍcoseeasnnennoesooiienokisikosilllgiS440508358588ã08ã50800688i095005385/558108088 50 2.4.2 Results of business operations in 2006 — 201( - << s<<s 52

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AGS SUDSCHIDELS coussccsssciasaswiasssisinnnninntansinadibdiadbibaindntenssseeenneeverssnuzenveczenevens 54 2.4.2.4 Assessment Of the ACTIVIEV: icscccsccccscsseseccesscessssssssssssssesesesssseesessesenes 54

Mobile Telecom Services CompDan\ cv 9 55

2.5.2 Happy Birthday €US(OICFS G0 SG G0 0 61

2.5.4 Internal Customer CArF€: SG S9 Ý 184 888 156 63

2.5.5 Special customer €ar€ DFOĐFAIT 25G G5 99.959853889551 8865556 64

2.5.7 Longtime subscribers ccsccssssssssssssscsssscsssssssscsesscssrssssssssessensess 66 2.5.8 High-rate subscribers csscsssscssssssssssssssscsscessscsssscsssesesesssessnsees 68

2.5.9 Polieies for Business / Organization / GTOuDD s- << <ssss<ss+ 69

services (key and dominant), evaluation on the current stituation of service

supply in Vietnam Mobile Telecom Services Company osssss<s<s 5 70 2.6.1 Core competitive advantage and the most important services: 71

Telecom Company sccnserssscnssscscsacesemassssnsseerseavensewavnnsnenssessasvennvacnenvonves 73

CHAPTER 3: PLANNING STRATEGIES AND SOLUTIONS TO

IMPROVE THE QUALITY OF SERVICE SUPPLY IN VIETNAM MOBILE TELECOM SERVICES COMPANY IN THE PERIOD FROM 2011 TO 2015 scssssassscnancssvexvsnsncesenenssnaescenevenevsaxeansmavevarsuancis ins

Telecom Services Company ssccscassusessvesssascevenvemsvascsvescassansansssssa varies svssacsasabserdsesed 75 Sell YÍRÌGH seaseseanaaseosndnirrnontantdiiagiiidttinttE2601N(ĐMANaELSESEAA51368265555656466sss2eessdee 75

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2011 < 2 LỘ nernnnndennronnaniiibiiitooniripndtrrgiittia881180080550Sã00888i186S28315555Lk55 5A sssssuesssosssersppae 77

3.4 Stratesic PlanNiiG sescscccasccrsuassssassrsssscacssccaccsseesosovecevrrerecersesenseeganennsnnene 78

COMPAN) sccccsssssoscseesscssessrsccssscsseescssssscsssssesssseeseesnssssssesssssssassseeeees 78 3.4.1.1 Macro environment äï14ÌÏWSÌS - 7s << s1 90 9 0 055 8556 se 78 3.4.1.2 Micro enVirOnIM€HI G - G S00 005 0005 8005 8883588835 80 3.4.2 Analysis of matrices to choose the SfFA{©ØV o2 S1 29556 255 86 3.4.2.1 External factor evaluation matrix (EEE) - 5-5 << «<< ss se 86 3.4.2.2 Internal factor evaluation matrix (LETE) - 55s ss s5 sese 87 3.4.2.3 SWOT TMaFiX G0 G00 HH 00 00000 0005 060096 88

3.4.2.4 SPACE Matrix Go 0.10000005508005 ø 92

3.4.2.5 Competitive profile matrix (CPM ) cccsssssssssscssssssssssccessssssceees 94 3.4.2.6 Quantitative strategic planning matrix (QSPM) (Specific strategy

M4000 e 95

mobile telecommunications service in Vietnam Mobile Telecom S€rViCes COmDADV G0 c0 gọi 00000000 00080005 9555000860 97

3.5.1.1 Improving the coverage area and quality of serviCes - 97 3.5.1.2 Diversification for the services offered on the market 98 3.5.1.3 Promoting awareness and enhance using of value-added services 100 3.5.1.4 Simplification of procedures and standardization of to service supply

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3.5.3.2 Enhancing the provision of services in the form of door - to — door104

3.5.4 Solutions for promotion, Customer Care: :cccsscecesssscssssesssesesees 104 3.5.5 Solutions for Information TechnoÌOgy: - <5 s55 << cc< << seesse 105

3.5.6 Human Resource SOÌU(ÏOIS: S 5< G <5 993 5518551855, 106

3.5.6.1 Continuing te build the image of the polite and professional behavior

for alll staffs .cccccccsssccssssssccccccsssscsscccceessseccceacssececessecccescececsscees 106

communication skills and customer care attitude for all staffs 106 3.5.6.3 Improving the working environment for staffs: - 106 3.6 Proposals and recommendations sccccssccsssrccssscesssscessessseseees 107

lô 9) 10) 010/30) P0012 Ẻ6Ẻ 109 REPERENC ES crsscessnssnenasnecesncsununcanenussnacnsnnmessneuxemennksnenvanmenusramarormnnmennanane 188 110

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MobiFone’s prepaid and postpaid subscribers in 2006 - 2010 56

MobiFone’s revenue ot prepaid and postpaid subscribers in 2006 -

ZU sss.saceecounséncerversapeesenuersamnveneanap sen sueennenb su 9MBS'GĐ0.2LGDTDEGVESESEE4I503/0008 57

Information about Viettel Tel€COTM «s«ssssssS51E55655551 2s sse 83

Information about VINAPHONE co se se 111251155 85 Information about S-FONC cssesscssssesscsecsessscsssessesescsesescesereeseees 86 External factor evaluation matrix of VMS - MobiFone 87 Internal factor evaluation matrix of VMS - MobiFone 88 Factors on the axes OE SPACGE MRHÍN daueesanddoandndrdsnanaagagoseii 93 CPM Matrix of VMS = MObiF O16 snscssasossenacanaxcennensencsssesanesensanvans 95

9À)3/0 0101777 97 Table 3.8:

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LIST OF FIGURES

Eigure 1.1: Comprehensive strategic management model .s«ss<<s<s< 17

Eigure 1.2: Michael E Porter's five forces competition model (Source:

Criggs Lniversiy - Strategic kianagement TexIbOOĂ) .««-«- 19 Figure 2.1: Vice Prime Minister Hoang Trung Hai awarded the title "Labor

Hero’ for Vietnam Mobile Telecom Services Company 39

Figure 2.2: Structural organization of Vietnam Mobile Telecommunications

Services Company (Source: Administrative Organization Dept Vietnam Mobile Telecommunications Services COMPANY) sersssesseseeres 41

Figure 2.3: Revenue of Vietnam Mobile Telecom Services Company in 2006 -

2010 (Source: Finance and Accounting Dept - Vietnam Mobile

Telecom Services COMPANY) sssssssssssssssssssssccserssscsssssseasscsssenesseseesessesees 53

Figure 2.4: Sales of Vietnam Mobile Telecom Services Company in 2006 —

000) CC CC 54

Figure 2.5: Subscribers of Vietnam Mobile Telecom Services Company in

2006 - 2010 (Source: Planning and Sales Dept - Vietnam Mobile

Telecom Services COMPANY) sssssessrsssssesessessssseccsccescsscscsscsscsececsseseosecs 34

Figure 2.6: MobiFone’s prepaid and postpaid subscribers in 2006 - 2010

(Source: Planning and Sales Dept — Vietnam Mobile Telecom M.a/a 2002/2005 54

Figure 2.7: MobiFone’s revenue of prepaid and postpaid subscribers in 2006 -

DO Ossxcaxacanscsmmunmensnsaassocesswasanssssuxssvassss seit sidcacasapaneeensneavenenennenrnennenennene 58 Figure 3.1: Subscriber market share of mobile phone service

(Source: Planning and Sales Dept — Vietnam Mobile Telecom )M.a 22002 2/0000 .ẻ.Ề.Ặ 82

Figure 3.2: SWOT ÍMATIX 5< << Sen 90088395883958163810304071040 s5: 91 Figure 3.3: Qffensive strat€øy ÍImAaĐ€ S191 8151838515101 65161 50 re 93

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INTRODUCTION

1 The reason to choose the topic:

Along with the rain-storm development of technical science and information technology, mobile telecommunications service has developed with very quick speed and has become one of the essential services in the social life of mankind

In Vietnam, according to the data of Ministry of Information and Communication to the end of 2010, the number of mobile subscribers generates the output which reaches approximately 120 million subscribers Vietnam market with over 89 million people has a high and stable growing economy and young

population structure, mobile telecommunications service will have a lot of potential and growth opportunities

Today, the use of features on mobile phones has become necessities for all strata and mobile telecommunications service is an integral part in the life of every

people

With seven network companies are currently operating and trading in

providing mobile telecommunications services, the competition will occur and the progress is increasingly fierce and going in-depth At this time, in addition to concerns about coverage area; subscription charges, which company focuses on its service quality, understands the needs and preferences of each customer segment in

order to maximize the potential consumer of customers, that Company will be successful Therefore, our group has chosen the theme: "Strategy for the quality improvement of the service supply for improvement the quality of providing the

mobile telecommunications services in Vietnam Mobile Telecom Services

Company in the period 2011 - 2015"

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2 Research objectives:

The study objective of the thesis is to develop strategies to improve the quality

of service suplly in Vietnam Mobile Telecom Services Company in the period 2011

— 2015 to bring competitive advantages compared with the rival network, contributing to the success of the company and serving customers better

3 Research content:

Based on the basic knowledge of strategic management in business studied the group will be based on the actual situation in Vietnam Mobile Telecom Services Company to study and apply the theoretical basis for strategic management, for the products - services development in order to the quality of service supply in Vietnam

Mobile Telecom Services Company in the period from 2011 to 2015

4 Research methodology:

Our group uses the strategic matrices, combined with synthetic analysis

method based on market research data, the predictions of experts in the industry,

customer comments and the predicts for demand to use mobile services, subscriber growth pace, as well as the implementation of products and customers care services

- Chapter 2: Actual situation analysis of business and service operation in

Vietnam Mobile Telecom Services Company in the period from 2006 to 2010

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CHAPTER I THEORETIC BASIS ON STRATEGIC MANAGEMENT IN BUSINESS

AND SERVICE BUSINESS

1.1 Theoretic basis on strategic management

The concept of "strategy" has appeared very early from the studies for war in the history According to the normal meaning, the strategy (stemming from the

Greek root is strategos) is a military term used to refer to arrayed plans and force

distribution with the goal of defeating the enemy Sun Tzu is a Chinese military theorist who has also written "Art of War" to discuss military strategies

Carl von Clausewitz - the author of art of war in the 19th century - has described the strategy as "making war plan and planning combat campaigns

Until the middle 20th century, the strategic research and development in the business really began From scholars such as Drucker, Chandler, Ansoff, Andrew, Studied the great successful development of economic groups of the United States before and after the Second World War 2, until the managers, economists today such as Michael E Porter, Fred R David, Rudolf Grunig, Richard Kuhn have been many different approaches on strategic management in business

According Wikipidea, strategic management is science and art for strategy to

aim at developing business direction and goals, deployment, implementation of the

short and long term plans based on available resources, to help each organization be able to achieve its long-term goals

Here are a few different definitions of strategy:

- "The strategy is to identify goals, long-term basic purpose of the Company and the application of a chain of actions as well as distribution of necessary resources to carry out this goal" - Chandler (1962)

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- "The strategy is to coordination force between organizations and

environment consistent pattern on chain of organizational decisions consistent

with the environment" - Mintzherg (1979)

- "Strategy is a pattern or plan to integrate the major goals, policies, and

action series into a closely cohesive general" - Quinn (1980)

- "The strategy is difference li means that choices have calculation of a series

of different activities to create unique values"- Michael E Porter (1996)

- "Strategy is the means to reach the long-term goals" - Fred R David (2003)

- "Strategy is long-term, management orientation and to ensure completion of the long-term goals, the primary purposes of the company" - Rudoif Grunig and Richard Kuhn (2003)

Thus, although there are many different approaches and definitions, for a business strategy includes the following contents:

- Define the Company's basic and long-term objectives

- Give out the general action programs

- Select the action plans, implementation and distribution of resources to

accomplish that goal

There are many different types of strategies in a company, depending on the

level, approach can classify business strategies as follows:

1.1.2.1 Strategic levels:

In the view of the level, a company at least has three strategic levels as

follows:

- Strategy at the corporate level: Strategy directs the purpose and the overall

scope of the organization

- Strategic at business unit level: is related to how to successfully compete in specific markets

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Corporate level strategy

The strategy at the corporate level often aims at basic and long-term purpose

so there are many strategic types at the corporate with different names According

to Fred R David, there are 14 kinds of basic strategies at the corporate level classified into four groups as follows:

s* Integrative strategy group

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s* Mixed Strategy

Business unit level Strategy

Business unit level Strategy relates to the way to successfully compete on the specific markets Business strategy includes the competitive way which the organization selects the organizational way of positioning in the market to gain competitive advantages and the different positioning strategies can be used in the context of the industry

According to Michael F Porter, at the business unit level there are three overall competitive strategies:

- Cost leadership strategy (low price and best price)

- Product differentiation strategic

- Focus strategy

Functional level strategy

Functional level strategy is strategy of the functional departments such as marketing, finance, human resources, etc These strategies help improve the performance of the company and support for business strategies, corporate level strategies for effective implementation

Strategic management process consists of three phases:

- Strategic planning phase

- Strategic implementation phase

- Strategic evaluation phase

Fred R David has given out the comprehensive strategic management model

as the Figure 1-1 In which, the strategic planning phase includes the steps: Define strategic vision, mission, objectives then conduct analysis of the external

environmental factors to identify opportunities and risks, internal environmental

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analysis to give out strengths and weaknesses of the company, thereby determining the business goals and establishing long-term goals and choosing strategies to implement Strategic implementation phase will include the distribution of resources to make the annual goals and policies The last phase is to measure and evaluate the implementation of the strategy

Analyze the externel environment,

Establish annual targets

Establish long-term goals

identify opportunities and risks

Measure

and evaluate the implementa

Analyze intemal Select Propose the

environment strategies policy receiving for

Figure 1.1: Comprehensive strategic management model

(Source: Fredr David - Concept of strategic management review)

1.1.3.1 Strategic planning phase:

a External environment analysis

The purpose of analyzing the external environment is to develop a list of

restriction for environmental opportunities can bring benefit for the company and

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the threats that the company should avoid to reduce the harmful effects from the external environment There are many different external environmental factors (macro environment and micro environment) the analysis of external environment just needs limitation to the factors that affect greatly the Company

«* Macro environment includes:

e Economic environment

e Political and legal environment

e Cultural, social environment

0 Demographic and geographic environment

e Technology environmental

e Global environment

s* Micro-Environment: is a competitive environment, also known as the

industry environment, is the environment linked directly with the company, most of

the operations and competitiveness of the company lies in this environment

Michael E Porter, professor on business strategy of Harvard has given five

forces competition model as Figure 1.2

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NEW POTENTIAL RIVALS

SUPPLIERS

SUBSTITUTES

Figure 1.2: Michael E Porter’s five forces competition model

(Source: Griggs University - Strategic Management Textbook)

b Internal environmental analysis

In every company, there are always different strengths and weaknesses in

business units Strengths and weaknesses of the internal environment are combined

with external opportunities and threats and along with the mission statement as the

basis for establishing objectives and strategies of the company

Factors of the internal environment such as:

** Finance consists of the factors of financial capacity, financial

management, financial accounting,

s* Management: \ncludes all management activities to ensure that the results

of operations and business practice consistent with the results of planning such as

management capacity of human resources: production management, quality

management management of raw materials, financial management, management of

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«* Marketing: Marketing is described as a process of identifying, forecasting, setting up and meeting the needs of consumers for products and services Marketing

management includes: market development research, target market selection

system of distribution channel, services after sales

s* Human resources: Human resources play an important role in the success

of the company Whether a strategy of the company is correct, but it will not bring efficacy if there is no human working effectively Personnel include factors such as organizational structure of human resources, quality of human resources and policies to maintain and develop human resources

s* Management of production and operations: Includes all activities to

transform inputs into goods and services of the company The process of production and operations includes: designing the production process, choice of technology production lines, production scale, location choice, layout arrangement, quality of

products, prime price of production

c Using matrices to evaluate (IFE, EFE, SWOT, SPACE, CPM, QSPM)

s* External factor evaluation matrix (EFE)

The construction of external factor evaluation matrix will help us summarize

and quantify the effects of external environmental factors to the Company, it affects

the production and business activities of the Company; including factors that

opportunity and challenge for the company

To build the matrix, we conduct to make a list containing all the external

factors affecting the operations of the Company Assessing the importance level of each factor by scoring the weight, total points of the weight of all factors is 1 The

classification shows the respective importance of those factors for success in the business of the Company

The evaluation of the importance level of each factor by sorting the elements from | to 4 Among them: level 4 is level that the company is best response, 3 is

20

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If total important score is 4 it shows that the company is taking advantage of

good external opportunities and good control or minimizing the external threats for the company If total score is 1, indicating that the company does not seize the

opportunities and can not reduce minimum threats from the external environment

External factor matrix evaluation (EFE)

(Source: Fredr David - Concept of strategic management)

“* Internal factor evaluation matrix (IFE)

The building of internal factor evaluation matrix will help us summarize and evaluate the important strengths and weaknesses of functional business units, it

affects the production and business activities of company

To build the matrix, we conduct to make a list that lists all the internal factors affecting their production and business activities of the Company, as defined in the internal evaluation of the company Evaluating the importance level of each factor

by scoring the weight, total weight points of all factors are 1 The classification shows the respective importance of those factors for success in the business of the

Company

The importance level evaluation of each factor by sorting the factors from | to

4 In which: 4 is level that the company is best response: 3 is above average 2 is

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If total important score is 4, it shows that the company is having many

strengths, and can better overcome the weaknesses Conversely, if the total score is

1 indicating that the Company does not have too many strengths and weaknesses

which can not be overcome

Internal factor evaluation matrix (IFE)

estimate the chances and risks of the external environment of the company Since,

then a combination of factors between the environmental situation with the ability

of the Company into business strategies We have the following SWOT matrix:

^^

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SWOT Matrix List the risks in order of

List the opportunities in order -

List the strengths in order of Use: strengifisto exploit Use strengths to minimize the

List the weaknesses in order Limit the weaknesses to A minimum of risk and limit

of importance W1, W2, W3 | exploit opportunities 1, 2, 3 | the threat of one, 2, 3

(Source: Fredr David - Concept of strategic management)

«* Matrix strategic position and action evaluation (SPACE)

The Strategic Position & Action Evaluation Matrix (SPACE) is a management

tool used for strategic analysis It is used to determine the type of strategy that the company should implement

to lỗ

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-4

5

6

ES

(Source: Fredr David - Concept of strategic management)

As illustrated in the figure, the SPACE matrix divides coordinate plan into

four quadrants, each quadrant represents a different form of strategy:

- Agrressive

- Competitive

- Defensive

- Conservative

SPACE matrix’s axis represents the two factors within the financial strength

(FS) and Competitive advantage (CA) and two external factors Environmental

stability (ES) and industry strength (IS) These four elements are crucial for the overall strategic positioning

24

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«* Competitive profile matrix (CPM)

Building competitive image matrix helps the company identify the competitors, along with advantages, disadvantages from which to help the company have appropriate business strategy

This matrix includes all the internal and external elements of the Company

having importance for the success of the company In the competitive profile matrix, the competitors are also considered and calculating total important scores Then, we compare the total important points of these competition companies with sample competing companies Thereby, we will have mere information to develop business strategies for the company

(Source: Fredr David - Concept of strategic management)

“* Quantitative strategic planning matrix QSPM

QSPM Matrix is aimed at evaluating and ranking the strategic plans, from which we have basis to select the best strategies for the company

This matrix uses all information, data from the matrices mentioned above including: IFE, EFE, competitive profile matrix, SWOT Matrix,

To develop formation of a matrix QSPM, it needs to go through six steps:

- Step 1: List key internal strengths and weaknesses (minimum ten factors), external

threats (minimum 10 factors) in the left column This information should be taken from

to n

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IFE and IFE matrices

- Step 2: Classify each internal and external important factor The classification is

same at EFE Matrix and [FE matrix

- Step 3: Identify strategies that can replace the organization should consider for

implementation The strategies are formed and set into separate groups

- Step 4: Determine the attractive score (AS), is to quantify the relative attractiveness

of each strategy in the strategic group can be replaced The attractive score are determined

by considering the degree of influence for the choice of strategies which have been assessed for each internal and external important factor Attractive score is assigned for eacn strategy to represent the relative attractiveness or each strategy compared with other

strategies The attractive score is classified as follows: | - not attractive, 2 - less attractive,

3 — quite attractive, 4 - very attractive If certain element does not affect the selection, it does not score and blank that row

- Step 5: Calculate the total attractive score (TAS) Multiply the classified score with attractive score in each row If only calculating the influence of internal or external factors under consideration, TAS shows the relative attractiveness of each strategy and the higher TAS the more attractive strategy

- Step 6: Sum the attractive score Sum attractive score for each strategy Total score

of each strategy indicates which strategy is most attractive in each strategy group

Quantitative Strategic Planning Matrix QSPM

Strategy can be selected

- | Strategy | | Strategy 2 Strategy 3

Important factors Classifi | Attrac | Total | Attrac | Total | Attrac | Total

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(Source: Fredr, David - Concept of strategic management)

Note: The classification of external factors: 1 - little reaction, 2 - average response, 3 — higher reaction than average, 4 - the highest reaction Classification

of internal factors: a - the weakest, 2 — less weakest, 3 — less strongest, 4 -

strongest

QSPM matrix has many advantages such as helping combination of the

appropriate internal and external factors in the decision process, the strategic groups can be studied continuously or simultaneously, an unlimited number of strategies can be evaluated, but it also has some limitations such as the matrix QSPM requires

the intuitive judge and based on experience The discussion between managers, employees in the process of analysis and strategic choices can raise different

opinions

d Setting up the mission (business objectives)

e Determining long-term goals

f Proposing strategies and strategic choices

1.1.3.2 Strategic implementation phase

In order to implement effective business strategies which have been established, the company should:

* Establish short term goals

* Adjust the organizational structure

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* Build policies

* Develop budget

* Develop corporate culture

1.1.3.3 Strategic evaluation phase

The evaluation of a business strategy is effective or not is very important One business strategy is effective when that strategy is consistent with the reality of company and socio-economic situation; as well as it can take advantage of opportunities to achieve the Company's proposed target The evaluation strategy

includes the following steps:

* To review and examine the appropriateness of the business strategy before implementation

" To assess the efficiency of production and business operations of the company in each phase of strategic implementation, in order to detect flaws, defects

of the strategy, so that to have the adjustment, modification, supplementing in time

1.1.4.1 What is customer service?

Service is understood that many various types of different activities and commercial operations According to Philip Kotler, the service is defined as follows: Services are any measure or benefit that one party may provide the other party and primarily can not touch and not lead to the appropriation of something The implementation of services can have and not involve in goods in the form of its physicality

1.1.4.2 Characteristics of customer service

* Intangibility: This is a basic feature of the service With these characteristics show that the service does not exist in the form of tangible matter, do

not see it, do not feel it, do not smell it

* Integrality: Service is always associated with its supply source The service "production" and "consumer" occurs simultaneously, does not pass any

28

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* Perishability: The service can not reserve storage services to meet market demand in the future, customers can not purchase service reserve for use when

needed In terms of demand changes, the computer does not save the service is not a

problem but if demand fluctuations, the service companies will face serious problems

Because of the above characteristics, providing services for customers have

specific characteristics unlike private provision of tangible goods, products

1.1.4.3 Importance of customer service

Service has existed for a long and has played an important role in social life

As the economy grows, the service keeps important position Services have brought

29

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high income and make up high proportion of GDP of most countries with developed economies The density of service industry in gross domestic product is considered basic criteria for classifying a country's wealth and poverty

s* Wiih the basic marketing model, we still have mainstream 4P nameiy:

- Product

- Price

- Place

- Promotion

“* With the services marketing is different, we have 3P more :

- People (Staff, customer )

- Process (Services process, implementation steps, sequences )

- Physical Evidence (Clothes of staff, equipment, infrastructure )

“7P Marketing" Model was initiated branding by expert in 2001, by now has been increasingly accepted by marketing world as an advanced legacy model-based

principles of traditional marketing 4p, expanded vertically to generate pyramidal

architecture (the three level hierarchy), in step 2 those are P5 & P6 (People & process) and in step 3 is P7 (Physical Evidence)

In the context of products, markets, customers and needs changing rapidly, you will be constantly concerned about these seven Ps to make sure that you remain on track and achieve the best possible results for your businesses in the market

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telecommunications, not landline, connect the calls to help the subjects can receive and make calls use of all facilities at all times Mobile telecommunications services include the types of postpaid services prepaid services (also known as paid packages pre-paid packages) and added value services bring much convenience for

customers

Mobile telecommunications services are new manufactured material

products not the specific goods that are useful efficiency of the process of transmitting information Thus, mobile telecommunications services provide many

of the properties of other products and services with material products

Core service component: voice service This component is aim at meeting the

demand for mobile telecommunications anytime, anywhere by customers To provide services to satisfy this demand, the company needs to have broad coverage, good network quality, network of diverse types of services is appropriate for the needs of customers and reasonable rate policy

Surrounding service component: the value added services except voice service, the services of direct sales and chargeable at home, customer support call- centers, promotion programs, diversified after-sales services The more diverse

these services, the higher quality utility will increase for customers, the better

satisfaction for customer demand for services To provide good components of these services, the company should have a system of diverse added value services,

extensive customer service programs and, wide distribution channel, customer

service capacity of the transaction points and customer answer support switchboard,

good professional and communication staff

Core services and surrounding services are separate services together in a system to create the overail services It is considered that they are different parts of

an overall service but its system provides its own services

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Surrounding Services (Value added Services)

Core Service (Voice Service)

All the above components create the overall services, creating different gamuts

of value-added services, creating the different high and low level of service, ie bringing satisfaction which is not the same for customers The development of the

service components, especially the additional components, associated with the formation and development of "cultural choice" of customers

1.3 Necessity must plan the quality improvement strategy of providing the services at Vietnam Mobile Telecom Services Company:

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According to the most general meaning customer services (customer care)

are all necessities that the company must do to satisfy the needs and expectations of customers, ie customer service following the way they desire to be served and doing the necessary things to keep their existing customers Customer care is an important part of marketing plays an important role in ensuring the success of any company The customer service must be carried out comprehensively in all aspects of products and services offered to customers The care for customers is emphasized in all

phases and stages involved in providing mobile telecommunications services

Customer here is understood in the broadest sense ie all relevant customers (external customers and internal customers), not only to the extent customers use

mobile telecommunications services

1.3.1.2 Three basic pillars of customer satisfaction issues:

** Factors of products (suitable products, reasonable prices):

- Diversity of provided products

- Product price

- Quality and specifications of products

- "after-sales service" Quality

«* Convenient factors (appropriate sale location, convenient hours)

s* Human factors (how to behave)

- Skill level of salespeople

- Attitude behavior of employees

and the necessity has to plan the strategy to impreve the quality of service supply in Vietnam Mobile Telecom Services Company

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As stated above the customer care has become the most important area for the company to build its competitive advantage The customer care work can only be

recognized as good if it is associated with a quality product or service However,

customer care includes not only the satisfaction of needs related to the use of products and services but also including the meeting for the unclear needs of customers The response requires better, more than competitors can do and must overcome the expectations of the customers to turn them into "fans", into the

"property" of the Company

For companies to survive and grow, the company needs to build a real business environment focused on providing the best service for customers This is the best way to enhance the competitive advantage of the company Competition today is not only competition on product that the company’s made at his company but also on the services that contribute to the finished product One of those services

is doing good customer care work

If according to Philip Kotler, marketing is science and art of searching,

keeping and cultivating profitable customers, the customer care is the second part -

"Keeping and cultivating customers." Previously, they considered the "Searching of

Customer" more importantly but today it is opposite, "keeping and cultivating"

customer is really important The position of customer care activities for the development levels of the customers is described in the following diagram:

With important role of customer care in promoting competitive advantage as

well its increasing position compares with other marketing activities represented by

many trends, identified as follows:

- Customers increasingly tend to decide to buy products with their feelings and

hearts and minds, not by logic analysis as betore

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- Direct marketing is gradually given way for relationship marketing, business

is no longer to maximize profit for each deal that becoming maximizing profit on every customer relationship

- Market share is looking back, satisfying customers as looking forward, this

is the indirect search for new customers through "good rumour"

- Finding new customers is important, but to keep the existing customers are much more important The companies could spend up to 70% of marketing budget

to attract new customers while 90% of sales come from existing customers Just

because of the focus on new customers, each year the company loses from 10 to 30% of customers, whereas if reducing this number of 5%, the company's profits can be increased from 25 to 85 %

These are the most recognized by companies and have been focused in competition in order to increase customers to increase sales and profits But wanting

so, to improve the quality of the service supply must be dedicated to grow, this is the crux of the problem That is also the reason for our group (of which 03 members are working for Vietnam Mobile Telecom Services Company) has selected the topic: “Strategy for the quality improvement of the service supply in Vietnam Mobile Telecom Services Company in the period 2011 - 2015"

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CHAPTER 2

ACTUAL SITUATION ANALYSIS OF BUSINESS AND SERVICES OPERATION IN VIETNAM MOBILE TELECOM SERVICES

COMPANY IN THE PERIOD 2006 — 2010

2.1 The birth and development of Mobile Telecom Service Company 2.1.1 About enterprise

- International Trade name: VIETNAM MOBILE TELECOM SERVICES

COMPANY

- Abbreviated international trade name: VMS

- Head office: MobiFone Building, Lot VP1, Yen Hoa Urban Area, Cau Giay

District, Hanoi

- Scope of work: Building designing organization, developing networks and

deployment of providing new services on mobile telecommunications with advanced, modern technology, mobile telecommunications services business with the technology GSM 900/1800 nationwide

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2.1.2 Process of formation and development

Vietnam Mobile Telecom Services Company - VMS, a_ state-owned company under Vietnam Posts and Telecommunications Corporation and had been transformed the enterprise type since 07/12/2010 according to the Decision No

Corporation

Founded in April 16th 1993, VMS has become the first GMS 900/1800

mobile telephony services provider in the brand name MobiFone marking the beginning momentum of the mobile telephony industry in Vietnam

The process of formation and development of Vietnam Mobile Telecom Services Company:

- 1993: Foundation of Vietnam Mobile Telecom Services Company (VMS);

- 1994: Foundation of Vietnam Mobile Telecom Services Center I & II, the

headquarters were located in Hanoi and Ho Chi Minh;

- 1995: Foundation of Vietnam Mobile Telecom Services Center III, located

in Da Nang City;

- 2006: Foundation of Vietnam Mobile Telecom Services Center IV, located

in Can Tho City;

- 2008: Foundation of Vietnam Mobile Telecom Services Center V, located

in Hai Phong City And, the Value Added Services Center;

- 2009: Foundation of Charging and Liquidity Center;

- 7/2010: Conversion into A member limited Company of the State-owned:

- 12/2010: Foundation of Vietnam Mobile Telecom Services Center VI,

located in Bien Hoa City - Dong Nai Province

2.1.3 Achievements in recent years:

«* Awards in 2008:

e First-class Labor Medal awarded by the President

e ~The excellent ICT business in 2008” voted by PC World’s readers

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® “The best quality service provider in 2008" voted by Saigon Tiep Thi Newspaper

e “The most favorite mobile operator in 2008”; “The best customer care

operator in 2008” voted by VietnamNet cyber newspaper and E-Chip Mobile Magazine;

e “The excellent mobile operator” granted by Vietnam Ministry of

Information and Communication at Vietnam ICT Awards 2008:

e ~The best customer care operator in 2608” granted by Vietnam Ministry

of Information and Communication at Vietnam ICT Awards 2008

e "The Best Customer Care Operator " awarded in 2009 by the Ministry of

Information and Communication at the Vietnam ICT Awards ceremony 2009,

e "The most favorite ICT products in 2009" voted by PC World magazine’s

readers

“+ Awards in 2010:

e The best customer care operator in 2010 awarded by the Ministry of

Information and Communication at the VICTA ceremony 2010

e The title "The Most Favorite Operator in 2010" voted by the readers of

VietnamNet and EchipMobile magazine

e “The Best Services and Customers Care Operator" voted by the readers

of of VietnamNet and EchipMobile magazine

e “The Most Favourite ICT Product in 2010" for the field of mobile phone

network voted by PC World magazine

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Vietnam Mobile Telecommunications Services Company affiliates under VNPT officially received the title of Hero of Labor which was awarded by the President on 15/07/2011, because of having had many outstanding achievements in employment, creation, contributing to the overall development of the industry and the country

Figure 2.1: Vice Prime Minister Hoang Trung Hai awarded the title "Labor

Hero" for Vietnam Mobile Telecom Services Company

2.2 Organizational structure

Currently, Vietnam Mobile Telecom Services Company has 14 functional

departments, boards and 8 other affiliations, including six Mobile Telecom Services

Centers at 5 regional centers value added services center (VAS), Charging and liquidity center, design factory

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