Strategic business development of Petrosetco Vung Tau general services Joint Stock Company (Petrosetco Vung Tau)

GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM CAPSTONE PROJECT REPORT STRATEGIC BUSINESS DEVELOPMENT OF PETROSETCO VUNG TAU GENERAL SERVICES JOINT STOCK

GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM

CAPSTONE PROJECT REPORT

STRATEGIC BUSINESS DEVELOPMENT

OF PETROSETCO VUNG TAU GENERAL SERVICES JOINT STOCK COMPANY

(PETROSETCO VUNG TAU)

PERIOD 2010 - 2015

Group Number: 3

Student’s name:

Bui Thi Minh Chien

Truong Minh Chien

Vo Thi Thuy Huong Pham Ke Nghtep

Pham Huu Tri

Ho Chi Minh City, 2011

Thank you!

First of all Group 3 sincerely to thank the GaMBA 01 C02

program, the teachers, the monitors, the supervisors has been

communicating and teaching all the most valuable knowledge for

us duration the course — Global Advanced Master of Business

Administration program

Secondly we would like to say that: the research was completed by the Group 3’s working, However, due to time limited

time, the limited knowledge, so the research haven't good as much

as your respect We would like to receive the comments of the

teachers, lecturers and other suggestions to make this completely

Last of all we would like to thanks you very much and give the best wishes for all of you — who have been enthusiastic to asstst

us in the process of implementing this course

Thank application

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CHAPTER II: REAL SITUATION ANALYSIS OF PETROSETCO VUNG TAU GENERAL SERVICES JOIN STOCK COMPANY 23

I ABOUT PETROSETCO VUNG TAU GENERAL SERVICES JOIN

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GaMBA01.C02.G.3 ' Global Advanced Master of Business Administration

Petrosetco Vũng Tàu

Il REAL SITUATION ANALYSIS OF BUSINESS ACTIVITIES OF

PETROSETCO VUNGTAU (INTERNAL FACTORS) VÀ

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2.8 Analyzing business results and financial condition from 2008 to 2010 4]

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CHAPTER III : STRATEGIC PLANNING AND IMPLEMENTATION OF STRATEGIC SOLUTIONS CORPORATION OF GENERAL SERVICES PETROLEUM VUNGTAU PERIOD 2011 -2015 .- 555cc 30 L,SIRATEGH PLANNINEG QDĐQDD.-Đ kkkesrarirrnnnirgrbieHDInnGLtTEGIVG1SE200000EĐ7A 53

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H ANALYSIS AND CHOICE OF STATEGY IN PERIOD 2011 - 2015 56

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GaMBA01.C02.G.3

i Global Advanced Master of Business Aaministration

Grice) Petrosetco VingTau

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Galcod) Petrosetco ViingTau

LIST OF TABLES

CHAPTER I: THEORY OF STRATEGIC MANAGEMENT 4 Table 1.1 Matrix assessment of internal ÍaCfOFFS G5559 56 10 Table 1.2 Matrix assessment of external ÍACfOFS 005G 95056 12 Table 1.3: Matrix 1mage Competitions sceeseeeeeeeennrnndiiniaiiskii008950615406601506160585665 14 Table 1.4 SPACE at ix seeaeeaeeennedaranrarnnninpinitatikgtitoasrxatt09509115800EE665690505915668144 17 Table 1.5 Strategic nia tr tt eeeeserridderdennnnnnnnnniatgsiipbrlgS05000019950665856515598586800565 19 Table 1.6: Strategic planning matrix QSPM co HH H01 996 Z1 CHAPTER II: REAL SITUATION ANALYSIS OF PETROSETCO VUNG TAU GENERAL SERVICES JOIN STOCK COMPANY -<<<<< 23 Table 2.1 Customers of Petrosetco Vung “Tau o5 <5 5555 s93 55225 28 Table 2.2 Labour structtireé (31/12/2010) .sssscecssvesseserseensacenvennenavsscansaccenecees 34 Table 2.3 DEGPGe Gf LAD OF sssinesiecere rr cemeee ee ERORTORERERRCTEED 34 Dable DA Wort 6 vecsesessrn scsi eissteteespooreasnsomnemnnneniinin ners 35 Table 2.5 Market share competition was dominated from 2008-2010 39 THBIE 5:6 SHDDIEESoeearaerensrnrbtirridtittoTttitTtigtxiÏPGRSSSEE4619X36181900000800080161004 489980008 40 Table 2.7 Business results from 2008 — 201Í 0G G9065 956 41 Table 2.8: The ratio of fiscal 2009 and 20 Í() 0o G5 S5 959565589996 42 Table 2.9 Internal factors evaluation mAfFÏX <5 5< se e9 55 44 Table 2.10 External Factor Evaluation Matrix (EFE Matrix) « 46 Table 2.11: Some key indicators of the OSC (2008 — 20110) <- 49 Table 2.12 Some key indicators of Getraco period (2008 — 2010) 50 Table 2.13 Competitive matrix of Petrosetco Vung 'Tau 5- << s« 51 CHAPTER III : STRATEGIC PLANNING AND IMPLEMENTATION OF STRATEGIC SOLUTIONS CORPORATION OF GENERAL SERVICES

PETROLEUM VUNGTAU PERIOD 2011 -2015 - 5-5 5555 s<s s<s5 53

Table 3.1 Five year 2011-2015 business plan of Petrosetco Vung Tau 53 Table 3:2 SWOT Analysis ccccsscssssssvsssscssacsaasescansrssatsadpeapiearnenereusresevenenasonsannocentonnns 56

Table 3.3: The elements of the matrix SPACCE 55 S556 195555, 60

Table 3.4 Main sirafÍEpic THÍ TK eeeepesaaiiiiiii01121610122102561499.x65010160048073041660 m6.ss6 63 Table 3.5: The proposed strafegies in each mAfFÏX 55555 s5 s2 65 Table 3.6 QSPM Matrix —Group of strategies for focused growth 0000 66 Table 3.7 QSPM Matrix — Group of strategies for integrated growth 68

GaMBA01.C02.G.3

Global Advanced Master of Business Administration

Griccd) Petrosetco VingTau

Griccs) Petrosetco Viing Tau

LIST OF FIGURES, GRAPHS

CHAPTER I: THEORY OF STRATEGIC MANAGEMENT 4

Figure L.1 Strategic planning Giagra mM snccssvcssssessacsssvssssssnssvesnnsnnsesasesevensosssssccossens 4 Figure 1.2 Strategic management MOdel : ccssssscseresesensssssassssesesascesesessanssssoneess 6 Figure 1.3 Diagram describing the enterprise value chaiïn 7 Figure 1.4 The external environment affecting businesses .- 10 Figure 1.5: Competitive environment of Michael Porter . 13

CHAPTER It: REAL SITUATION ANALYSIS OF PETROSETCO VUNG TAU GENERAL SERVICES JOIN STOCK COMPANYY -«- 23

Figure 2.1 Organizational chart of Petrosetco Vung Tau < = << 26 Figure 2.2 Market share of catering companies in Ba Ria Vung Tau 48 CHAPTER III : STRATEGIC PLANNING AND IMPLEMENTATION OF STRATEGIC SOLUTIONS CORPORATION OF GENERAL SERVICES

PETROLEUM VUNGTAU PERIOD 2011 -2(015 - 5< 555 ««ssse+ 33

Figure 3.1 Vung Tau Petrosetco’d trend when compete, attack, defend and

Some pictures of Petrosetco Vung Tau

Food transportation to the boat supply

The 1000 ton capacities frozen wearhouse of Petrosetco Vung tau

Checking the vegetable and fruit before loading in container send to the rig

Container system for loading the food send to the rigs

Gricod) Petrosetco VingTau

INTRODUCTION

1 Topic’s reason Enterprises have to plan the business strategy in order to be successful in business They need a thorough understanding of the market to find out customer’s need Especially when Vietnam is one of the official members of the World Trade Organization, (WTO) Vietnamese companies need obey the market’s mechanisms

in organizing the business operation for instance: building their own appropriate strategy for the business and ready to accept competition among rivals to increase the market share In order to win a larger market share and the growth of the

business is continuously improve efficiently, it is imperative to build a business-

Strategies appropriately, so the company can orient the operation according to their

setting-out business objectives

In case of Petrosetco Vung Tau General Services JS company operating in the field of catering service on the sea rigs (Catering Services) - an essential area and relates directly to health of Oil and Gas experts who are working in an especially environment as the sea rigs The exploration and exploitation activities of oil and gas are considered to be to develop continuously not only in the Ba Ria- Vung Tau province, but also in many internal-external areas

For nearly 30 years, despite of many achievements of Petrosetco Vung Tau

in providing services that meets customer needs, it also have some shortcomings and inadequacies in operation and business activities due to the inappropriate

strategies, such as: Marketing activities are not strong, staffs are not dynamic and

the low-level competition, so providing Catering services is constantly attacked by competitors to dominate market, that leads to decrease business targets In this case, Catering operations have to confront many difficulties and challenges

All these reason above encourage group 3 to research the project:

"Developing Business Strategies of the Petrosetco Vung Tau General Services Joint

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Griccs) UNIVERSITY Petrosetco Ving Tau

- To clarify the business environment in the life service field of the

Petrosetco Vung Tau General Services Joint Stock Company to find strengths - weakness, build models and choose business strategies for Petrosetco Vung Tau

The essay is also planning objectives and implementation of strategic solutions for next 5 years and proposing recommendations to PetroVietnam, the associated levels

with the best policies for support Catering services of Petrosetco Vung Tau

3 The limitations of the Assignment

This study was completed by the hardworking of Group 3 However, because catering services at sea rigs is a specialized section, this essay can only be applied to

companies operating in this area In addition, due to time as well as the limited

researchers view, the data collection may be diverse and inevitable shortcomings Group 3 would like to receive the comments of the teachers, lecturers and other suggestions to make this completely

4 The Structure of Assignment

Introduction

Chapter 1: THEORY OF STRATEGIC MANAGEMENT

Chapter 2: REAL SITUATION ANALYSIS OF PETROSETCO VUNGTAU GENERAL SERVICE JOIN STOCK COMPANY

Griccs) Petrosetco Vung Tau

Chapter 3: STRATEGIC PLANNING AND IMPLEMENTATION OF STRATEGIC SOLUTIONS CORPORATION OF GENERAL SERVICES

PETROLEUM VUNGTAU PERIOD 2011 — 2015

Conclusions — Recommendations References

GaMBA01.C02.G.3 (GF ova Advanced Master of Business Administration 3

Gricc) Petrosetco VingTau

CHAPTER I: THEORY OF STRATEGIC MANAGEMENT

I Defining STRATEGY:

The term “strategy” is widely used in business and life; so many different concepts are created by experts:

- According to Michael Porter, strategy is defined:

* Unique competitive position of the enterprise;

* Compromise and the choice for competition;

* Other business activities;

* Gives customers a unique value mix

- Other scholars: strategy is a plan achieving the organization’s objectives

- Although there are many views on the strategy, according to us strategy is a set of long-term basis objectives, which fit in the vision, the mission of the organization to achieve goals in the best way, so that we can increase the strengths and overcome weaknesses of the organization, welcome the opportunities, avoid or

minimize risks from external environment

Il STRATEGIC PLANNING:

As defined the strategy, we must consider the internal environment and external environment of enterprises, in order to determine:

- Strengths and weaknesses of the business, including capabilities and its core

C2

Analysing the internal factors helps us understand the advantages, for example: what we can do better than competitor and what things we can improve, repair , so that we can find out our position in order to plan the strategy

Analysing the external factors affecting the business help us understand the operation of business- sector, such as which factors are affecting the market and the attractiveness Finally, we can learn how the factors affecting and affected by the

business and competition

It STRATEGIC MANAGEMENT PROCESS:

Strategic Management can be defined as an establishment of art and science,

implementation and evaluating decisions related functionally, it allows an

organization to achieve those goals In this definition, strategic management focuses

on integrating all the management, marketing, finance and accounting,

manufacturing, research, development and information systems, business sectors in one place to achieve the success of the organization

According to Fred R David, strategic management process includes three

stages: creation, implementation and evaluation

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Global Advanced Master ot Business Administration 3

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Environmental studies Establish | 4] Set annual I

to identify long- I goals :

Identify tasks, Review of I Distribution | | đ

objectives and business + >! of resources [* al

Figure 1.2 Strategic management model - Source: Fred R David

We will focus on analysing the strategic creation’s stage compared with two stages remaining (strategic implementation and evaluation strategies), because the core value of the research is to develop business strategies for companies

C2 Global Advanced Master of Business Administration 6

GaMBA01.C02.G.3

Griccd) Petrosetco VingTau

3.1 Identify tasks, objectives and current strategy of the organization

This is a starting point in the strategic management because the current situation of the company can reduce some of the strategies and specific action Each organization has the tasks, goals and strategies, even these factors are not set up or

written out

3.2 Review of business tasks

The mission of business is to establish priorities, strategies, plans and

allocation of work This is the starting point for setting up the schedule and management structure This review allows Enterprises to outline the direction and set goals

3.3 Environmental studies

The environmental research focused on the identification and assessment of trends, events which overcome the control of company Environmental operation of the enterprise is divided into two categories: the macro environment and operational

environment

3.3.1 Environment for micro enterprises

According to Michael E Porter's entire business operations are divided into

two major categories: primary activities and support activities

Marketing & Sales

Figure 1.3 Diagram describing the enterprise value chain— Source: Michael E Porter

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CG Global Advanced Master of Business Administration 7

Grico) Petrosetco VingTau

a) The basic operation: is physical activities that are related to physical creation, sale and delivery of products (actually added value) to customers as well

as, the after- sale works

Internal logistics: is activities that includes receiving, storing and managing the

inputs of the business such as: (1) To receive inputs (machinery, equipment, materials), (2) Manage materials, (3) management of materials storage, (4)

Pregramming for media activities, (5) transportation plan, (6) Return of goods to the supplier made to convert the input into product

Production: are all activities to convert inputs into final products such as: (1) Operating machinery and equipment, (2) Packing and packaging, (3) Assembly, (4) Storm equipment maintenance, (5) Check

External Logistics: are activities of the company to bring the product to customers, such as (1) Management of semi-finished products, (2) Storage of finished products, (3) operating distribution facilities, (4) The process of ordering and processing

orders

Marketing and sales: (1) Advertising, (2) Promotion, (3) Sales, (4) Select the distribution channels, (5) Establish the relationship between the distribution

channels

Services: (1) Installation (2) customer training, (3) Repair, (4) Settlement

requirements, customer complaint

b) Support activities: is the activity that supports the basic operation and supports each other Procurement, technology development and human resource Management can support for the entire chain Infrastructure of the enterprise is not affiliated with a single major operation and only support for the entire value chain Shopping: buying all the inputs used in the value chain such as: (1) purchase of raw materials, (2) purchase of raw materials and energy, (3) purchase of machinery,

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(CC Advanced Master of Business Administration 8

Griccd) Petroseteo Vũng Tàu

laboratory equipment, office equipment, premises, (4) Procurement management software, (6) supply sources management

Technology development: are the activities that relate to improve our products and

processes of business activities

Human resources administration: including the three main activities:

- Attracting human resources: (1) work Analysis, (2) human_ resource planning, (3) Recruitment

- Training and development

- Maintain human resources

Infrastructure of the company: including activities such as general management, planning, finance, accounting, legal support, relationships with government agencies to support the entire value chain

c) Internal factors evaluation matrix (IFE)

This matrix has summary function and evaluates the important strengths and weaknesses of function business parts IFE matrix is developed in five steps:

Step 1: List the critical success factors

- Step 2: Importance assigned by sorting from 0.0 (not important) to 1.0 (very

important) for each element The total number of critical levels of 1.0 to

- Step 3: Classification from | to 4 for each element, lis the biggest weakness, 2

is the smallest weaknesses, 3 is the smallest strengths, 4 is the greatest

Griccd) Petrosetco Ving Tau

The highest important total score is 4.0; least is 1.0; average is 2.5 Total scores are greater than 2.5 indicate the internal strength of the company, less than 2.5 indicates the weakness internal company

Table 1.1 Matrix assessment of internal factors

level points

i, Total 1,00 -

3.3.2 Macro environment of business:

Figure 1.4 The external environment affecting businesses - Source: Slide lecture

Strategic Management of Griggs University

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a) There is six major external forces affecting businesses:

Politics: is the politics of the country where the enterprise is operating, tendency of changing policies and regulations of the host country, changing the law (tax law, business law, and land law), and policies to encourage investment in the regions, industries and fields The role of state-owned economy, nationalizing

Economics: inflation, unemployment, GDP (adjusted for growth), the exchange rate (export problem), the interest rate (cost of capital), the psychology of

foreign investment and domestic investment, economic downturn cyclical, and the

price of basic raw materials: electricity, water, fuels ., the rate of consumption and Savings

Demographics: population size, age structure, geographic distribution, racial diversity, income distribution

Culture, society: consumer and social trends, family structure, social- consumption habits, level of community awareness

Technology: scientific and technical qualified development in our industry sector, the introduction of new products base on new technology, new production methods base on savings (less labour), new management models

Global influence: important politics, economic world’s events, the changes

of new industrial countries, the difference from cultural characteristics and

institutions

b) External factors evaluation matrix (EFE) This matrix helps us to summarize and quantify the influence of environmental factors to the business The development an EFE matrix consists of five steps:

- Step 1: Make a list of factors that play a decisive role to the success and identified in the macro-environment of the assessment process

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Global Advanced Master of Business Administration 11

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Petrosetco Vũng Tàu

- Step 2: Sort importance from 0.0 (not important) to 1.0 (very important) for each element The classification shows the importance of factors to succeed in the business of the company General classification levels must be equal to 1.0

- Step 3: Classification from 1 to 4 for each determinant of success 4th is a good reaction, 3 is above average, average is 2 and | is weak

- Step 4: Human importance of each variable with its classification (= step 2 x step 3) to determine the important score

- Step 5: Plus a total score of the importance of each variable to determine the total number of point, which is important to an organization

Regardless of the number of opportunities and threats in the matrix is the total number of the highest importance that a company can have is 4.0, the lowest

importance points

c) Operational environment of enterprises

In order to analyze the operational environment (or micro-environment and

environmental sectors) of the business, we apply the model in the power of Michael

E Porter (1980) expressed by the following diagram:

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Bargaining power of suppliers

Threat of Bargaining substitute power of products buyers

to size, government policy, possible action can be applied

Power of suppliers: will increase if:

Small number of large-scaled suppliers and vendors Few appropriated substitutes, small number of clients , products of suppliers is extremely important

in the winning of customers-heart in the market; Changing other products may be expensive, the supply is able to penetrate deeply into the branches of the seller

Negotiating power of customers Buyer power will increase if:

Large and quantity buyers are few; buyers consume most of the product; Buyers have a large proportion of the annual revenue for sale; switching costs is low; the purchaser is able to penetrate to the sellers, buyers have full information

The threat of substitute products The threat of substitute products increases as:

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Buyers do not pay high costs when switching products, prices of substitutes

is lower, quality and effectiveness of the product are better than alternative products are currently being used; this threat will exclude the product which is highly appreciated by customers

Intensity of competition in the industry

Competition in the sector will increase if:

There are competitors which is as strong as the company; this business

section grows siowly or declines, high fixed costs or high costs of storage; hard to create opportunities for differentiation or switching costs is low, when a company wants to branch out

Identifying opportunities and threats: after evaluating the factors and forces from outside the company will identify: the opportunities have to catch, the threat

Table 1.3: Matrix image competition

L Competing firm | Competing firm

factors importa | Classif Classif Classif

import import import

nt ication ication ication

points points points

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IV ANALYSING PROCESS AND STRATEGIC CHOICES

4.1 Establish long-term goals

- The long-term objective shows the expected results why we pursuit that

strategy The strategy indicates the measures to achieve long-term goals Timeframe

for the objectives and strategies must be get along each other, usually from 2-5 years

Each target is often accompanied by a period and associated with some indicators such as growth of capital, revenue’s growth, the level of profitability, market share, level and basis of the combination longitudinal

4.2 The process of formation and strategic choices: Include 3 stages

4.2.1 Stage 1: Input

This phase summary the basic information being entered into the form that needed for the strategy During this period, we will create the matrix: the matrix

elements evaluated the internal factors, the matrix evaluated of external factors and

matrix image competition

4.2.2 Stage 2: Combine

Focusing on making realistic strategy can be selected by arranging, combining elements inside and outside the key The techniques used in this phase

include: matrix threats - Opportunities - strengths - weaknesses (SWOT) matrix

strategic position and action analysis (SPACE), the matrix factors inside and outside (IE) and grand strategy matrix

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a) SWOT matrix

Identify the strengths and competitiveness: is a strong point as a company operating and doing well or a characteristic increase competitiveness of the company for examples: Capacity, human resources or know-how valuable property

is worth, assets held, Intangible assets; the basic competitiveness; alliance and

association

Identify weaknesses and competitiveness inefficient: a weakness is an activity and the company made a loss or reduction properties of the company's competitiveness such as: Inefficient in terms of know-how or experience or capacity, lack of tangible or intangible asset, don’t’ have core competence in basic areas

Identify the challenges from outside:

The introduction of these technologies is better / cheaper, competitors have better products, complex regulations, interest rates rise; capability will be acquired; The migration of the population exchange rates; The politics is instable

The role of SWOT analysis in building a better strategy Building a clear understanding of the company: strengths and weaknesses, the best opportunities and challenges, all of these will lead top conclude how to mobilize resources inside and outside the company, thinking strategically to

strengthen the company's resources for future

There are 8 steps to build a SWOT matrix:

¢ List the major opportunities in the external world

* List the main threat

¢ List the major inner strength

¢ List the major weaknesses in intern

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¢ Combining inner strength with the external world the opportunity to create

SO -strategy

¢ Match internal weaknesses with external opportunities to form strategic

gender WO

* Combine with inner strength with threats to form ST -strategy

¢ Match internal weaknesses with threats to form WT- strategy

SWOT tool to help managers make four types of strategies:

°Ồ SO Strategy (Strengths - Opportunities): use of inner strength of the company to catch the opportunities in the external world

* WO Strategy (Compliance - Opportunities): reduce internal weaknesses by taking advantage of the opportunities from the external world

¢ ST Strategy (Strengths - threats) using the inner strength of the company to

avoid or reduce the threat of external world

b) WT Strategy (Compliance - threats) is defensive strategies aimed at

reducing internal weaknesses and avoids threats from external world

Features Strategy should use

Aggressive The company is in the best Penetration, market

position development, product

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Combining multiple strategies

Conservative Companies should work Penetration, market

with the basic capability development, product

development and

diversification of focus

Defensive Companies should focus on Strategic spending limit,

improving internal eliminate, liquidate and

weaknesses and avoid diversify focus

external threats

Competitive Strategy combining back,

forward, horizontally, entry strategies, market

development, product development venture

d) Internal — external factors matrix (IE):

IE matrix put the different parts of the organization to include a 9 cell IE matrix based on two main aspects, the total number of critical points on the axis of the IFE matrix X (denoted point: from 1.0 to 1.99 is weak inside, from 2.0 to 2.99 average, from 3.0 to 4.0 is strong) and total points on the Y axis is important (denoted point: from 1.0 to 1.99 is low, from 2.0 to 2.99 is average, from 3.0 to 4.0

is high)

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forward and horizontal)

- The parts are in boxes III, V, VII can be called "Hold and maintain."

Appropriate strategies, such as market access, product development

- The parts are in boxes IV, VIII, [X is the section "harvested and remove”

e) Strategic matrix:

Matrix assesses the position of the company based on two aspects: competitive position and market growth Strategies which appropriate for organizations are listed in order to appeal in every corner of the square matrix

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‘Corner IH Corner IV

|

.1 Reduce spending 1 Diversifying concentrated

la, Diversifying concentrated |2 Horizontal diversification

3 Horizontal diversification |3 Diversifying link

4 Diversifying connection |4 Venture

Strategy matrix can be quantified (QSPM): six steps to develop a matrix QSPM:

- Step 1: List the opportunities / threats and other important external strengths / weaknesses inside the company

- Step 2: Classification for each critical success factors inside and outside This

classification is just like the IFE and EFE matrix

- Step 3: use Matrix in the phase 2 (combined) and identify possible alternative Strategies that organizations should consider for implementation, write them on first line, put strategies into separate groups if possible

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- Step 4: Determining the gravitational point of each strategy (AS) Point of attractions is distributed as follows: | is not attractive, somewhat attractive is

2, 3 and 4 is quite fascinating and very attractive If successful factors do not affect the choice strategy, we don’t have to mark it

- Step 5: Calculate the total number of attractions (TAS), is the result of multiplying the number of classification (step 2) with some interesting points (step 4) in each row

- Step 6: In total attraction for each strategy That is the sum of total attractive strategy in the column The higher score indicates more attractive strategy

Table 1.6: Strategic planning matrix QSPM

Ex:ernal factors

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development, have appropriated business strategies To create the business strategy,

we must analyze the external environmental factors as well as local business to identify the factors affecting business activities

In Chapter 1, this assignment shows some basic theoretical- knowledge about strategies such as the concept planning strategies, management processes and matrix business strategy

The basic knowledge about theory and strategic management and business strategies mentioned in Chapter | is the basic foundation for creating the business

strategy of the Petrosetco VungTau General Services Joint Stock Company

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CHAPTER II REAL SITUATION ANALYSIS OF PETROSETCO VUNGTAU GENERAL

SERVICE JOIN STOCK COMPANY

I ABOUT PETROSETCO VUNGTAU GENERAL SERVICES JOINT STOCK COMPANY

1.1 General information about Petrosetco Vung Tau General Services Joint Stock Company

- Name of company: PETROSETCO VUNGTAU GENERAL SERVICES JOINT STOCK COMPANY

- English trading name: PETROSETCO VUNGTAU GENERAL

SERVICES JOIN STOCK COMPANY

- Abbreviation: PETROSETCO VUNG TAU

- Head office address: No 63, 30/4 Street, Ward 9, Vung Tau

- Business registration certificate: No 3500835690 by Department of Planning

and Investment of Ba Ria Vung Tau province, dated 03 January in 2008,

which changed the 3rd time in June 6, 2010

1.2 About the main business activities of the Company

- Provide catering services for offshore petroleum projects

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- Provide both international and domestic rigs and platforms in petroleum industry with food drinks, fuel, gasoline as well as equipment for daily life

- Doing other businesses based on the oriented strategies of the Petrrosetco

1.3 About the catering services

Catering sservices is directly done on the drilling platform that consists of two main parts:

- Meal supply;

- Cleaning services for bedrooms and offices on drilling platform;

Oil and gas drilling, exploration and exploitation normally have people with

many nationalities working together on the oil-rigs and platforms All duties on

drilling rigs and platform are hard and long-time jobs Therefore, customers can easily upset if service caterers are not dedicated and careful

Catering services style need to suit different culture and nationalities The menu

must be diverse and must not overlap in the same month Catering staff must be

carefully recruited, have good health, good foreign language, well trained in

cooking with careful and dedicated serving styles

Cleaning duties in oil rigs and platforms such as bedroom, table cleaning and

laundries are highly industrialised jobs Hence, cleaning staff should know how to

use detergent in order to clean up things with gentle and dedicated attitude

Equipment that needs to be invested is the large food storage systems including cold storage, vegetable storage, materials storage and container system

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like frozen containers, dry containers, vegetables container First stage food processing system also needs to be built together with micro-sterilization system

Build and apply quality control measures according to international standards

such as ISO 9001-2000 and HACCP system

The process of service implementation from making plan to purchase food from vendors, move into storage, safety check and transfer into dedicated containers After that, catering companies contact and coordinate with sea-port

Operators to transfer foodstuff into service rigs which will carrier the food to oil rigs

and platforms All stages of procurement, first-stage processing, storage and transportation must be implemented according to made-schedule, technical

procedures, followed by with dishes processing procedures based on the requested and approved menus of the customers menu on oil rigs and platforms

Requirements for service quality: Catering Company has to know its customers in terms of psychology, economics, culture and_ religion characteristics For example; European customers like eating more meat than Japanese customers who love to eat more seafood Meanwhile, Islam guests do not

eat food which is made from pork and Hindu do not eat beef All of these are to

ensure customers accept the company’s services

1.4 Vision - Mission - Core Values - Business Philosophy Vision: "To become a leading company in Vietnam in catering services" Mission: "Create the highest value for customers and shareholders; provide all company’s staff lives with full of material and plenty of spirit; share the results

with the community and contribute to the development of oil and gas industry of

Vietnam"

Core values: "Create real value through hard work, effort and creativity"

Business philosophy: "Safety - Efficiency - Development"

1.5 Organizational structure and apparatus:

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- Company leaders include:

* Board of Management: 5 members (01 President work full time, 04 members

— work occasionally according to agreed schedule):

* Board of Directors: 04 members (01 Directors, 03 Deputy Directors)

# Supervisory Board: 03 members (01 supervisor work full time, 02 members work occasionally according to agreed schedule):

- Management Departments: includes 6 function Departments (Finance and Accounting, Human and Organization, Commerce, Planning and Materials, Safety

and Quality, and Marine Services Departments)

- Service and Production Departments: include Onshore service Management Department which manage 05 service teams In turn, these service teams will support the operation of catering service in 22 Vietsovpetro’s oil rigs, 22 foreign oil rigs, some of onshore customers as well as food supply operation for 48 oil ships

II REAL SITUATION ANALYSIS OF BUSINESS ACTIVITIES OF

PETROSETCO VUNGTAU (INTERNAL FACTORS) 2.1 Current situation services operations of Vung Tau Petrosetco

2.1.1 Offshore Catering services:

Onshore catering services have been operating from 1980 and incessantly grow and develop with Vietnam oil and gas industry However, from 2000 to now,

there were more and more oil contractors who joined and started doing exploration

and exploitation in Vietnam As a result, some new catering service competitors entered this market and directly compete with the company that lead to a decrease

in market share of the company The catering service activities are currently divided

into two main services:

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a Full package catering service:

The company is providing catering services for 30 drilling rigs, oil storage vessels, and service vessels for the Vietsovpetro Joint Venture Enterprise, Foreign

oil and gas contractors, the Joint Operation Companies in Vietnam such as JVPC,

PVGas, BP Pipelines, Technip, Ballasharm, etc

Most of the market share that the company dominates is market of catering services for Vietsovpetro (VSP) However, Vietsovpetro’s operation mechanism is much bureaucratic and this takes more times and effort of Petrosetco Vung Tau to satisfy Vietsovpetro’s demand In addition, the company’s competitiveness is still weak and less flexible, marketing team is lack of good leader and not working effectively, as well as not active to gain more market share

As a specific characteristic, 90% catering service activities is depending on

the oil and gas exploration and exploitation strategies As a result, it is hard to have

a quick development when services are consumed in a very special environment —

offshore oil rigs and platforms, not a normal market On the other hand, the

company have not built a long-term strategy and clear direction for the near future

when more oil fields’ storage is depleting, the exploration and exploitation activities

will gradually reduce As a consequence, the catering service will decline as well

Table 2.1 Customers of Petrosetco Vung Tau

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| PETROSETCO - UNIVERSAL SODEXHO

11 | PTSC PORT AND PTSC MARINE Catering