Xây dựng chiến lược phát triển kinh doanh cho công ty cổ phần PJICO

Luận văn Xây dựng chiến lược phát triển kinh doanh cho công ty cổ phần PJICO Xây dựng chiến lược phát triển kinh doanh cho công ty cổ phần PJICO Xây dựng chiến lược phát triển kinh doanh cho công ty cổ phần PJICO Xây dựng chiến lược phát triển kinh doanh cho công ty cổ phần PJICO

Luận văn

Xây Dựng chiến lược phát triển kinh doanh cho công ty

Cổ phần PJICO THESIS

BUILDING THE BUSINESS DEVELOPMENT STRATEGY OF PETROLIMEX JOINT STOCK

INSURANCE COMPANY (PJICO)

FROM 2015 TO 2020

Hanoi, date January, 2010

COMMITMENT

Our group would like to commit:

- This theme is the research result of our group, not of any individual in thegroup Analyses in the theme of our group base on theory learned at classGaMBA01.M05 together with materials provided by the school and otherreferences Data mentioned in the research are true and have clear origin

- After being consulted by Subject Group of the school, our group hasacquired and supplemented and amended the report in conformability to therequirements of the program, and ensure objective independence in our ownresearch

PART I: REASONING BASIS FOR STRATEGY BUILDING

I./ STRATEGY ADMINISTRATION

1 Definition of strategy administration

2 Implications of strategy administration

3 Basic competition strategies in each business field

II/ PROCESS OF BUILDING STRATEGY

1 Determining business field

2 Strategy targets

3 Analyzing macro environment

4 Strategy analysis technique

5 Choosing business strategy

6 Organizing strategy implementation

7 Check, evaluate the implementation result and adjust

8

8

PART II: ANALYZING BASIS FOR STRATEGY BUILDING

1 Introducing the Company

2 Analyzing macro environment

3 Analyzing business environment

4 Analyzing with SWOT matrix

20

9

PART III: CHOOSING AND ORGANIZING THE

DEVELOPMENT STRATEGY IMPLEMENTATION

LIST OF TABLES

Table 1: Origin of competition advantage and basic competition strategiesTable 2: Business production situation of the company

Table 3: Business production result of the company in 2007

Table 4: Original insurance business result of each unit in 2007

Table 5: Business production result of the company in 2008

Table 6: Original insurance business of each unit in 2008

Table 7: Business production result of the company in 2009

Table 8: Original insurance business result of each unit in 2009

Table 9: Original insurance revenue in 2007

Table 10: Original insurance revenue in 2008

Table 11: Original insurance revenue in the first 6 months of 2009

Table 12: SWOT matrix

LIST OF FIGURES, GRAPHS

Figure 1: Process of making strategy

Figure 2: Business operation result of the company (2007 – 2009)

Figure 3: Market share in 2007

Figure 4: Market share in 2008

Figure 5: Market share of 6 months in 2009

Figure 6: Current organizational outline of the company

Figure 7: Operation market of service marketing

Figure 8: Current organizational outline of the company

Figure 9: Organizational model outline according to development strategy

1 The urgency of the theme

In the market economy towards integration, business production of product, service isnot completely decided by the company but the market In which international market,regional market controls local market which has to rely on the international market –That is the world market unifies but it often changes due to changes of factor groupssuch as international economic, financial-currency, political, social, cultureenvironment

For that reason, if the company does not accurately forecast changes of factors inregional, international environment affecting market scale, it will meet risk inbusiness production, as goods production is not conformable to market demands interms of quality, appearance, price, taste, etc, thus, it cannot compete in the market

To avoid risk in business production, the Company is compulsory to build strategy.Only with strategy, it can avoid risk in business in an integrated world In a worldwith global economy, competition is becoming more and more severe, thus, strategybecomes more valuable to the company

Insurance is a very important field to nations in general including Vietnam Insurance

is not only a risk removing method but also an effective capital-mobilizing channel forthe economy Practical insurance business activity in the last time shows continualgrowth of insurance sector

Insurance market in Vietnam in recent time is very active, various and is becomingmore and more professional Number of insurance dealing companies becomesincreasing Diversified possession forms in both life and non-life insurance and threefields of human, asset and civil responsibility insurance Companies operating ininsurance sector have gradually satisfied demands of customers

Of all many insurance companies, PJICO is evaluated as one of the companies withfastest development speed in the market and at present PJICO is one of the four

leading insurance companies in Vietnam’s non-life insurance market Right frombeginning days of establishment and during its development process, PJICO diddetermine its mission and was always patient to fulfill this mission That is:Providing synchronous, various and high-quality insurance service orientingcustomers; creating a professional, transparent, active and friendly workingenvironment for staff to uphold their competence and creativity; effectivelycooperating with partners to contribute and develop the community; Sustainablydeveloping to increase value for shareholders through diversification of insuranceactivity and financial investment.

Upcoming time is seen as the difficult period of the economy In the insurancemarket, there appears more competition from newly established insurancecompanies as well as market newly joining foreign ones Thus, to promote theleading position in Vietnam’s electric cable market as well as ensure sustainabledevelopment in next time, the Company needs to build competition strategy incurrent environment as well as development orientation in upcoming time

2 Research aims

Based on researching general reasoning on business strategy and overview of theinsurance market in Vietnam; The theme goes deeply to analyze the businessenvironment, real state of insurance business operation and development tendency

of this market, from that to build a sustainable development strategy at PetrolimexInsurance Joint Stock Company

3 Research object and scale

The object is Petrolimex Joint Stock Insurance Company, hereinafter called PJICOCOMPANY

Research scale: The theme focuses on studying, analyzing the real state of thecompany, competitive factors inside the company Analyzing the state ofcompetition environment to the development of the market, domestic and foreigninsurance businesspersons (competitors) hereinafter called COMPETITORS Fromthat propose investment strategy to develop the company and competition strategies

to ensure sustainable development of the company

4 Scientific implication of the theme

Systematize reasoning on building business strategy of a medium and smallenterprise A common form of enterprise of Vietnamese economy, especially jointstock company – a form showing important role in the integration process of thecountry to the world and region economy Analyzing business environment ininsurance sector, risking business sector, sharing loss with customers, insuranceproducts are services with unique, abstract but more extremely specific, practicalfeatures than all other products in the market once provisions in the insurancecontract are implemented timely, effectively

From that draw strong and weak points of the Company in this sector to buildcompetition strategy in the increasingly severe competition environment That islikely to a model for medium and small companies in different sectors of theeconomy which are based on medium and small enterprises of the country

5 Research methods

Main research methods used in the process of making this dissertation are analysis,reasoning, comparison, generalization, forecast, etc based on practical data,situation of the Company and market investigative documents of prestigiouscompetence evaluating organizations to find out specific solutions for the company

- Part III: Choosing and organizing the implementation of development strategy

of Petrolimex Joint Stock Insurance Company.

PART I: THEORY BASIS OF STRATEGIC

CONSTRUCTION FOR ENTERPRISE

I./ STRATEGIC ADMINISTRATION

1 Definition on strategic administration

Strategic administration is an issue paid attention to by many economists as well asadministrators Because the content of strategic administration is very wide onresearch range and rich in actual application; at each sight angle, people presentdifferent point of view and definition on strategic administration Although eachpoint of view is not completely adequate and comprehensive, on overall thesepoints of view have had big contribution to cognizing and carryng out theadministrative mission in enterprises The followings are some definitions onstrategic administration

- Strategic administration is the collection of administrative decisions and actionsdeciding the long success of the enterprise

- Strategic administration is the collection of decisions and action measures leading

to the planning and implementation of strategies in order to reach the target of theorganization

- Strategic administration is process of researching current environments as well asfuture environments, forming targets of the organization; formulate to implementand check the decision implementation aiming at reach the target in currentenvironments as well as future environments

Finally we would like to introduce a definition on strategic administration widelyused in intensive training courses on business administration in England, UnitedStates…and accepted by many economists

- Strategic administration is the art and science of the construction, implementationand evaluation on synthetic decision, helping each organization can reach its target.According to this definition way, strategic administration pays attention tocoordinating fields of administration, marketing, finance/accounting,products/operation, research and development as well as information system inorder to reach the success for the enterprise

2 The meaning of strategic administration

In fluctuation condition of business environment now, above all others, only onething that enterprises know surely is the change Strategic administration process is

a trend to help these organizations overcome troubles in business world by theirown capacity and effort This is the scientific research result basing on the tradingrealtity of many companies It is really a product of managerial science because ifoganizations establish good administration process, they will have a good support to

go on ahead However, the level of success depends on the implementation capacitymentioned in part of strategic application, showing the arts in administration

Strategic administration process basing on the attitude which the companycontinuosly investigates events happening inside and outside the company as well

as trends impacting strongly on the company has rapidly increased in these days Inorder to exist, all organizations force to have changeable and adaptable ability to thefluctuations Strategic administration process is stablished to help the companyconcentrate on the best adaptation to changes in long term

Strategic administration helps the organization to be more active instead of passive

in planning clearly their future; it allows the organization to pioneer and make theinfluence on its activity environment (instead of reacting weakly) Therefore,applying out of its ability to control and manage the enterprise; from chairman ofboard of directors, general managers to board of manager of many tradingorganizations or non-profit activities recover and cognize the strategicadministration On history, basic meaning of strategic administration is helpingorganizations make the better strategies via handling more suitably and methodly tostrategic choices However, recent researches show that the contribution of strategicadministration to implementation process is much more important than thecontribution to making sinle decisions or documents

Strategic administration creates for each person the very important cognitions Themain target of this process is reaching the understanding and committing toimplement both in board of manager and labors Thus, the most important benefitfrom the strategic administration is the understanding and committing to implement.Once people in the enterprise understand what ad why they have been doing, theywill feel that they are a part of the enterprise They commit to support it themselves

Labors and board of manager will become more active, they understand and supportworks, the mission, targets and strategies of the enterprise; helping people to havemore strength and promote their own quality and ability, contribute to thedevelopment of the enterprise

Benefits from the strategic administration that we can see here an be divided intotwo types: benefit can be counted to money and benefit can’t be couinted to money.Benefit can be counted to money

The application of strategic administration made companies more successful andhave futher vision in future, which is foreseeing the trends; it also helps thesecompanies implement tarets in short term better The achievement is figures aboutrevenues on profit, market share and increase level on the stock value of thecompany on stock market

Benefit can’t be couinted to money

The figures, achievements gained from finance are not the all results from applyingstrategic administration effectively The benefits gained are invisible benefits,uncounted in money; but it is very important, having desisive characteristics for thecompany such as the sensitiveness to changes of environment, the moreunderstanding on strategies of competitors, improving the capacity of labors,reducing the shyness to changes, understanding more about carrying out thetreatment Strategic administration makes the ability to prevent risks of enterprisesincrease because it encourages the exchange among managers in every parts andfunctional levels The exchange helps people be aware of their right in developingproducts and services, and acknowledge their contributios The awareness of labors

in work will make the unexpected results, the labor capacity reaches to 200%according to investigation data of Tom Peter

Strategic administration makes the following benefits:

- Help identify and arrange the priority and make the best of opportunities

- Bring out the facual outlook on difficulities of administrative mission

- Bring out a draff for comprehensive development of actions and control

- Minimize risks

- Help key decisions serve the proposal of targets better

- Help arrange better time and resources for defined chances better

- Allow to reduce necessary time and resource in order to amend mistakes andtemporary decisions

- Make the frame for the relationship among individuals inside the company

- Help coordinate single behaviors into a general effort

- Provide the basis for making clear the responsibilities of each individual

- Bring about the encouragement to advanced thoughts

- Bring about the cooperative, close-knit and fervent form in dealing with problems

as well as chances

- Encourage the positive attitude to the change

- Bring amout the discipline level and the formality to administrative mission in thecompany

3 Basically competitive strategies in each bisiness fields

Companies pursue the strategy at enterprise level in order to reach the competitiveadvantage, allowing them to operate better than competitors and reach the higherrevenues than the average They can choose from three basic strategies: leading onexpenditure, product differentiation and concentration

Above strategies are basic strategies of all enterprises or all sectors Each of threebasically competitive strategies is the result of consistent choices of the company onproducts, market and individual ability- these choices consolidated each other.Table 6.4 summerizes the suitable choice for each general strategy of the company

Table 1: Origin of competitive advantage and basically competitive strategies

to price)

High(mainly equal

to unique)

Low to high(price or unique)

Market

segment

Low(mass productionmarket)

High(many marketsegments)

Low(one or somemarket segments)

Individual

ability

Manufacture andmaterialmanagement

Research anddevelopment, saleand marketing

Any individual ability type

Strategic administration textbook – National Economics University – Ass Prof Dr Ngo Kim Thanh

3.1 Leading strategy on expenditure

The purpose of the company in pursuing the leading on expenditure or lowexpenditure strategy and better activity (having better advangtage) than competitors,doing everything to manufacture commodity or services at lower expenditure thancompetitors This strategy has two basic advantages Firstly, due to lowexpenditure, the people leading on expenditure can put the lower price than theircompetitors; they still get the profit equal to the competitors If the companies reachthe same value for their products, leader on expenditure can get the higher profitdue to its lower expenditure Secondly, if the competition in the same line ofbusiness increases and companies start competing, leader on expenditure will haveability to stand stably in competition better than other companies due to its lowerexpenditure

3.2 Differentiation strategy

The purpose of this differentiation strategy is reaching the competitive advantage bymaking the products – commodity or services- acknowledged the best by theconsumers due to their remark The ability of differentiation strategy to satisfy thedemand of customers according to the way that competitors can’t have, meaningthat it can reach the higher price – significant higher price compared with theaverage level of the sector The ability to increase the revenues by putting highprice (not by reducing the expenditure) allows differentiation product people tooperate better than competitors and get higher profit than the average level; andcustomers pay that price because they believe in the product quality ofdifferentiation products equal to that price difference

3.3 Centralization or concentration strategy

The third competitive strategy, concentration strategy, differs from two othersmainly because it trends to serve the demand of limited customer group or segmentmarket The company pursueing the centralization strategy pays attention to serving

a specific market segment, that segment can be defined according to geography,customer type, or a branch of product line

Once choosing a market segment, the company can pursue the concentrationstrategy or differentiation product or low expenditure On the nature, theconcentrative company is a differentiation producer or attractor on specialization

expenditure Due to the small scale, some concentrative companies can pursue theleading on expenditure and differentiation product If concentrative companies usethe method of low expenditure, products have been in competition with leader onexpenditure in market segments which not having the expenditure advantage Ifconcentrator pursues differentiation product method, all differentiation productmethods have been widely opened to concentrative companies

Once more characteristic of concentrative companies is that they compete withdifferentiation product people only in few market segments Companies pursueingconcentration strategy surely develop the quality of differentiation productsuccessfully because they have knowledge on a small customer group or the region.Moreover, concentrating on small production chain allows concentrator to make therenovation quicker than big differentiation companies Concentrative companiespay attention to establishing the market share in a market stegment; and if it issuccessful, they can start serving many market stegments and making the lost incompetitive advantage of differentiation people

II./ STRATEGIC CONSTRCTION PROCESS

Figure 1: The procedure of strategy planning

THE PROCEDURE OF STRATEGY PLANNING

Define the function, task of enterprise and strategic target

Analyze macroscopic environment

(Internal environment, business environment)

Select strategy

Deploy the strategy

Check, evaluate the result and adjust

1 Trading field definition

Trading field definition must answer the question: what is our line of business?What would it be? What must it become?

The answes are diverse and different Perhaps because enterprise only trades in onefield and they also participate in many fields Single line of business enterprise onlyoperates in a major field, multi-sector enterprise trades in many fields at least twobusiness fields

2 Strategic target

According to the most general meaning, strategic target and vision shown in thedeclaration of mission is the clear declaration on ambition that enterprises pursue.Therefore, strategic target is the destination which enterprises hope to reach It isthe purpose concretization of enterprises on the direction, scale, structure andimplementation progress under time In the market economy, in general, enterprisespursue three main purposes They are existence, development and diversification

3 Macroscopic environment analysis

3.1 Economic environment

The reality of the economy and trend in the future has influence on the success andstrategy of an enterprise Main factors which enterprises often analyze are thedifferent growth speed of the economy, interest rate, exchange rates and inflationrate Different growth speed of the econmy in well-off, recession and recoveryphases will influence on the consumption When the economy is at high growthspeed, it will make many chances for enterprises to widen their investmentactivities In contrast, when the economy is recession and decadence, it will lead tothe decline in consumption expenditure and simultaneously leads to the increase incompetitive force Normally, the decadence in the economy causes the fight in price

in manufacture fields, especially in mature fields The interest rate level will decidethe demand for products of enterprises Currency policy and exchage rate may alsomake some good chances for enterprise, but also be the risks for their development.Inflation and inflation prevention issue are also an important factor which must beconsidered and analyzed In fact, if inflation rate is high, the control of price andsalary can’t be made Inflation increases, investment project becomes risker,

enterprises will decrease the enthusiasm in investing in manufacture development.Therefore, high inflation is the risk to enterprises

3.2 Technological environment

This is the factor having big and direct influence on trading strategy of fields,sectors as well as many enterprises In fact, our world witnesses the technologicalchanges making the stagger, even causing the lost in many fields; simultaneouslyalso appear many new trading fields or more complete ones

The changes of technology of course impact on the lifecycle of a product or aservice A theorical cycle includes phases: beginning, development, mature andfade-out The reality to some enterprises and some products is that they will have anew development period after fade-out period Moreover, technological changesalso influence on manufacture methods, materials as well as behavior attitude oflabors

From that requires strategists to pay attention to the change regularly and theinvestments in technological advancement

3.3 Social – cultural environment

Medium and long term strategic period, social – cultural environment can be thebiggest change factor Lifestyles changing quickly themselves according to thetrend of importing new lifestyles are always the chance for many manufacturers.Enterprise also takes into account the consumption behavior, the change of agetower, birth and marriage rate, position and role of women at work and in thefamily The appearance of Association of consumers is the obstacle requiring theattention of enterprises; especially the product quality must ensure the benefit ofconsumers A challenge to manufacturers is that the intellectual standard of thepeople is higher and higher, more and more diverse

3.4 Natural environment

Wise strategists often pay attention to the climate and ecological environment.Sometimes, the risk of unpredicted changes on the climate is carefully considered

by enterprises having the manufacture and services relating to the crop

3.5 Politics, law and government environment

Factors of government, law and politics impact on enterprise according to differentdirections They can make the chance, obstacles even the real risk for the enterprise.They often consist of:

- Government is the biggest consumer in the economy

- The stability on politics and the consistence on big policy viewpoint are alwaysattractive investors Law system established and completed will be the basis to tradestably For example, enionmental protection law is the issue that enterprise musttake into account

- Decisions on advertisement to some trading enterprises will be the risk, forexample if they want to produce and supply high degree alcohol, tobacco…

- Decision on tax types and expenses can both make the chance and limit themanufature development

- The enterprise must take into aacount Labor Law and regulations on recruitment,promotion, pension policy, unemployment compensation

The Viet Nam’s official entrance into international organizations as ASEAN, WTOhas been created many opportunities for Vietnamese enterprise to investment,market as well as there are many challeges that Vietnamese enterprises mustconfront Liberalization of regional trade, tariff barrier demlishment will be the bigthreats for Vietnamese enterprises Furthermore, ASEAN also put its self in therelationship of global competitive world, such as the EU, NAFTA, Japan, China

Joining into World Trade Organization WTO, Vietnam will expand the exportmarket to many contries in the world, be enjoyed most favoured nation statute, not

to be discriminated in international trade But on the contrary, the challeges ininternational competitiveness will be more dractic

3.7 Analysis of environmental sectors

A narrow productive sector or a technical economic sector includes manyenterprises can offer the same or similar products and services can replace for eachother Mission of strategists is to analyze and predict the competitive influences inthe environmental sector to determine opportunities and threats for their enterprises

- Analysis of exsiting competitor: Competion beweent enterprises in a productive

industry offten include the main contents as: competitive structure of industry, insector, actual demand of sector and exit barries

Competitive industry structure in data and distribution capacity of enterprise’s

product in production Diffirent competitive structions have the diffirentapplucations for competition Competitive struction changes from the hoardproductive sector to the concentrated productive sector

Demand situation of a sector is another decisive sector for vehementcompetitiveness of internal sector Usually, high demand creates big opportunity forenterprises to expand their activity, on the contrary, low demand leads to violentcompetitiveness to enterprises maintain their controlled markets Danger to lose themarket is unvoidable for enterprises without competitive ability

Withdrawal barrier is a danger of serious competition when sector’s demand isdecreased heavily Barrier of economic withdrawal is strategy and sentitiverelationship beweent strong enterprises If an withdrawal barrier is high, enterprisescan be locked tightly in the unfavorable industry

- Analysis of potential competition: The potential competitors are enterprises

currently not competing in the same industry: but be able to compete if they chooseand decide to join the industry This is a threat to existing enterprises Enterprisecurrently trying to prevent potential competitors to join the industry because moreand more business in a competitive industry is fiercer than the market and profitswill be shared, the location of the business will change

The level of advantages and disadvantages to enter the industry by potentialcompetitors mostly depends on the barriers to joining an industry.

- Analysis provider: The suppliers can be considered a pressure of threat when

they are able to increase in price of input or decrease in the quality of products andservices which they provide Thereby, the profit-making capacity of enterprise isdecrease On a certain aspect, the threats that creates some dependence forenterprise

- Customer analysis: This is the force generated bargaining ability of the buyer.

The buyer can be considered as a competitive threat when forced enterprise to selloff or require high quality and better service Contrast, the weak buyers will bring

an opportunity for enterprise to increase prices to earn more profits Buyers include:the final consumer, distributors (wholesale and retail) and the industrial buyers

- Substitutes: Substitutes are another products can satisfy the needs of consumers.

Their basic characteristics have more advantages than normal products werereplaced in the individual characteristics Threats require enterprise to have theanalysis, monitor frequently the progress of technical - technology, which is directlyrelated to technological innovation, product innovation Moreover, the change ofmarket demand is also important factors creating these threats

4 Technical strategy SWOT analysis

The strategic administration uses many tools, technologies to analyze strategies.Topics using the analysis technique of strengths - weaknesses - opportunities andthreat (SWOT)

SWOT is the the collection of the first letter of the English words: Strengths Weaknesses, Opportunity and Threats This is a very useful tool to help usunderstand the problem or make the decision in the organization and management

-as well -as in business Say in a illustration way, SWOT is theorical frameworkbased on the that we can review the strategic and determinate the position anddirection of a organization, a company, analyze the proposed business or any ideasregarding the interests of enterprise In fact, the application of SWOT build abusiness plan, strategic planning, competition evaluation, market surveys, productdevelopment and in research reports are choosen more and more by manyenterprises

After analyzing the factors of macro environment and business environment,companies determine the opportunities and risks from external environment,strengths and weaknesses from the internal enterprise to based considerations andbuilding orientations and alternative strategies Techniques are widely usedtechnical analysis of strengths - weaknesses - opportunities and risks (matrix SOT).SWOT analysis provides useful information for connecting the resources andcapabilities of the company with the competitive environment that the company isactive This is a tool in the formation and strategic selection SWOT (also calledSWOT matrix) is a method of analysis of strengths, weaknesses, opportunities andrisks.

SWOT provides a tool for strategic analysis, review and evaluate the position andorientation of a enterprise or a business project SWOT is suitable with work andanalysis according to groups, is used in making business plan, bulding strategy,evaluating competitors, marketing, product development and services

SWOT analysis is the assessment of data held in a SWOT order in logic model, to

be understood, to be presented, discussed and to be applied it Four-dimensionalevaluation of the SWOT is to extend the two-dimensional "strengths" and

"weaknesses" SWOT analysis can be used for any type of decision making andpattern SWOT allow thinking positively, beyond the framework of habit andinstinct When the SWOT analysis, the first thing is to identify a subject to analysisclearly Only then can expect other persons to contribute into the analysis process,and those who see the results of the analysis can understand the purpose of analysismethods, evaluation and relationship between SWOT elements This method issimple, easy to apply and can be used in many fields of business activities

5 Selecton of enterprise’ s business strategy :

The implementation of analysis, selection and decisions a business strategy isnecessary to ensure a strategy has high feasible, which requires companies to buildmany projects, to be put forward standards to make the basis for the selection of anoptimal strategy If the choice is difficult, must be patient to find new opportunities,should not desperate Remember that political factors, culture of the organizationalso affect the strategy selection

Based on the principles and standards set out, the enterprise conduct to compare thestrategic plans that planned with the aim to find an appropriate business strategy toimplementation Strategy was selected must be the optimal strategy or at least beconsistent with the conditions and circumstances of enterprise To choose thestrategy is common to consider the following basis: The strength of industry andenterprise; Strategic objectives of the enterprise; attitude of the Chief Executive;Sources of financial ability and qualification of administrators; The reflection of theconcerned subjects and the time problem.

Strategic decisions are put into practice must be the optimal strategy or at least It isthe best of the strategic plan that built Want to select the best or most optimalbusiness strategy among strategies, people often use the method of score according

to standard

When evaluating optional strategic, need to ensure some requirements as follows:

- Otional strategic must ensure compliance with environmental conditions

- Otional strategic must be in accordance with foreign policy, viewpoits andmethods of the management board

- Otional strategic must be consistent with the financial material ability andpersonnel of the enterprise

Strategic selection is the final step of the strategic construction and also the initialstep for the strategic organization implementation Construction and selection ofbusiness strategies have put forward the necessary steps to have the feasiblebusiness strategy But let enterprise success in the business market, the selection of

an appropriate strategy has meaningful decision With the selected strategy,enterprises must implement the strategy effectively This is an important period and

a metabolic step the desire business strategy into reality

6 Organizations implement strategies

Organize the strategy implementation is often called the activity period of strategicmanagement Organization of implemention means to mobilize the teams ofadministrators and workers involved in the implementation of the strategicobjectives set out Organizing the strategy implementation is often considered themost difficult stage in the process of strategic management, strategy implementationrequires high discipline, dedication and sacrifice of each individual at enterprise

The success of organization of strategy implementation focus on the ability tomotivate, promote people to participation in the process of strategy implementation.Because the activities of strategy implementation are affecting all employees in theenterprise All departments and other sections must determine the tasks need tocarry out their part of the implementation process work the best

7 Check, evaluate the implementation result and adjust

Check and evaluate the strategy is the final section of strategic administrativeprocess

Check, evaluate and adjust having the purpose is defining the variation on target,measure, method and deployment result of strategic contents of enterprisescompared with initial estimate in order to establish the current condition, definereasons and estimate measures to adjust the strategy

Check and evaluate the strategy covering all sections and activities of strategicadministration, from planning the target, building the method to organizing to carryout the strategy

Requirements to the mission of checking and evaluating the strategy:

+ Carry out suitably to different periods of the strategy

+ Ensure flexibility

+ Ensure the provision

+ Concentrate on key and important points and contents

Check and evaluation standards:

+ Qualitative standards: are standards which can’t measure by physical measure,currency Qualitative standards must ensure the consistence, suitability andfeasibility

+ Quantitative standards: are standards which can quantify, measure, compare andanalyze

+ Other standards: politic trend and the pressure of parties make the difference onstrategic result compared with the estimate

PART II: ANALYSING BASIS FOR BUILDING STRATEGY

FOR PETROLIMEX JOINT STOCK INSURANCE COMPANY (PJICO)

1 Introducing Petrolimex Joint Stock Insurance Company (PJICO)

1.1 Company history.

PETROLIMEX Joint Stock Insurance Company (PJICO) is the first insurance jointstock company being established in Vietnam by big economic groups such as PetrolVietnam, Vietcombank, Vietnam Steel Corporation, Vietnam National Re-insuranceCompany, Synchronous Materials and Equipment Company, Hanoi ElectronicsCompany, Vietnam Railway Union, AT Safety Company On June 21st, 1995,PJICO was officially established in the warm welcome of domestic and foreigncustomers With the function of dealing with non-life insurance products, initially,PJICO Company only had 35 officers, after 14 years of establishment anddevelopment, at present, PJICO develops throughout the country with 51 branches,1.250 young, active staff and 4.500 professional agents presenting in the wholeprovinces and cities of the country, and is one of the four leading non-life insurancecompanies in Vietnam non-life insurance market

However, standing in front of the world integration, product, service business is notcompletely decided by the company but sometimes by changes of the market Thus,

to avoid risk in business production, the Company is compulsory to build strategy todevelop strongly in the common tendency, have an own development strategy inconformability to the socio-economic situation of Vietnam in particular andcountries in the world in general

1.2 Business fields of the company

Right after being established, PJICO quickly got access to the market andimplemented more than 80 insurance products and at present, is occupying themarket in fields such as: Transportation, work construction and installation, petroland oil, export and import goods and mechanical vehicle insurance, etc In which,

we must cover some products which are strong points, standing at the leading TOP

in Vietnam’s insurance market such as:

 Maritime Insurance profession:

- Insurance for goods which are transported by sea, land, river, air

- Insurance for ship body

- Insurance for civil liability of the ship owner

- Insurance for ship building contractor

- Insurance for river, fish ship

 Non-maritime insurance profession:

- Insurance for mechanical vehicle

- Human combined insurance

- Insurance for teachers, students

- Insurance for labor compensation

- Insurance for tourists

- Insurance for passengers

 Technique and asset insurance profession:

- Insurance for every risk in construction, installation

- Insurance for fire and special risks

- Insurance for every industrial risk

- Cooperating to invest, joint credit venture to domestic and foreign customers

1.3 Business operation result of the company (2007 – 2009)

Table 2: Business production situation of the company Unit: Billion VND

Source: Petrolimex insurance company (Pico)

BUSINESS RESULT IN 2007 OF PJICO

a/ General business result of the whole company

Figure 3: business production result of the company in 2007:

ntation 2006 (billion d)

Plan 2007 (billion d)

Implemen tation 2007 (billion d)

Implement ation rate 2007/TH

2006 (%)

Implement ation rate 2007/KH

- Data in 2006 are drawn the balance sheet and audited

- Data in 2007 are quickly collected on January 15 th , 2007.

b/ Original insurance business of each unit

Result of revenue, plan completion rate, implementation rate compared with 2006and specific compensation rate of each unit according to following table:

Table 4: Original insurance business result of each unit in 2007

ON

COMPARED WITH PLAN

2007

COMPARE

D WITH IMPLEMEN TATION 2006

COMPE NSATION RATE

GROUP 1: over 20 billion d

BUSINESS OPERATION RESULT IN 2008 OF PJICO

a/ General business result of the whole Company:

Table 5: business production result of the company in 2008:

Target Implementat ion 2007

Plan 2008 (billion d)

Implementat ion 2008 (billion d)

Implementat ion rate

2008 / Rate 2007

Implementati

on rate/ Plan 2008 1.Total business

Total business revenue reached VND 1.3008 billion, growing 25% compared with

2007, reaching 106% compared with the plan, in which original insurance revenuegot VND 1.060 billion, growing 19% compared with 2007, obtaining 102%compared with the plan assigned by Administrative Council Profit before tax wasVND 60,5 billion, increasing 32% compared with 2007, obtaining 86% of the plan.Average income per capita was VND 6 million, increasing 13% compared with2007

b/ Original insurance business result of each unit

Revenue result, plan completion rate, implementation rate compared with 2006 andspecific compensation rate of each unit according to following table:

Table 6: Original insurance business result of each unit in 2008

No Unit name

Plan (million dong)

Implementati

on in 2008 (million d)

Compare

d with

2007 (%)

Compared with plan

in 2008

Compe nsation rate GROUP 1: over VND 30 billion

BUSINESS OPERATION RESULT IN 2009 OF PJICO

a/ General business result of the whole company

Table 7: Business production result of the company in 2009:

Target Impleme Plan 2009 Implementa Impleme Implemen

2008 (billion d) (billion d) tion 2009

ntation rate

2009 / rate 2008

tation rate 2009/ Plan 2009 1.Total business revenue 1.308 1.426.6 1.555 119% 109%

Including original insurance

b/ Original insurance business result of each unit

Table 8: Original insurance business result of each unit in 2009

(million d)

Plan by Admin istrativ e Counci l

Impleme ntation in 2008 (million d)

Impleme ntation revenue 2009

Impleme ntation HQQU 2009

Implementa tion revenue compared with 2008 (%)

Compared with plan 2009

Compens ation rate 2009

Compe nsation rate 2008

Group12 - GaMBA 01.M05 Strategic Management

2 Analyzing macro environment

Group12 - GaMBA 01.M05 Strategic Management

Group12 - GaMBA 01.M05 Strategic Management

Group12 - GaMBA 01.M05 Strategic Management

Group12 - GaMBA 01.M05 Strategic Management

Group12 - GaMBA 01.M05 Strategic Management

Group12 - GaMBA 01.M05 Strategic Management