THE STRATEGY OF EFFECTIVE PRODUCTION QUALITY MANAGEMENT AND PROJECT INVESTMENT TO 2020 AT SUFAT VIETNAM CORPORATION

...Answer the question comes from hardness practices, a comprehensivedevelopment strategy, creative and feasible for the companies in the industry ingeneral, Company SUFAT VIETNAM partic

INTERNATIONAL EXECUTIVE MASTER OF BUSINESS ADMINISTRATION PROGRAM

CORPORATION 2013-2017

No Abbreviate Meaning

4 ISO 9001:2000 Quality Management based on ISO

1 Thesis origin

After more than five years of joining the WTO (01/11/2007) Vietnam'seconomy in general, Vietnamese enterprises in particular have moved andachieved remarkable initial achievement Economic growth in 2009 reached 5.2%(estimated 7-7.5%); 2010 was 6.78% (expected 6.5%); 2011 is 5.89% andVietnam stands in top 5 countries in the world with high growth rate

(Source: http://www.vcci-hcm.org/tt-907 )

In that Vietnam's total industrial output increased steadily over the years (seeAppendix 1) In 2010 it increased 14%, exceeding the previous forecast of 12%.But that's not the signs of sustainable growth Competitiveness of Vietnamesegoods in three class: country, sector and enterprise is less, in that their costremains high, low compared to international standards, service quality and lack ofprofessionalism Impact consecutive world economic crisis of 2007, 2009 plusinflation lasts and high credit interest rates in the country pushed Vietnamesebusinesses in danger of closing

It is on a general level

On the particular level, the Vietnamese motorcycle industry was formed, indevelopment for more than 10 years and specially rapid development in the period2001-2005 Apart from four Motorcycle manufacturers (first foreign-invested,developed in the 1990s) is VMEP (1984), Honda, Yamaha, Suzuki (1986), therewere more firms both FDI and local participated in the industry

Through many years , the overall picture of the industry now show a clearnegative signal that since 2008 almost all of the domestic motorcycle market share

by FDI enterprises dominate

DN trong nước FDI Nhập khẩu

Among the more than 10 domestic enterprises and "left", SUFAT VIETNAMCompany facing an intractable problem: What need to do to be able to "live"under strong competitive pressure from FDI? Continue to exist for thedevelopment or preservation and withdrew from an industry where product cycles

in the recession? If they stayed, how to overcome challenges to the survival andsustainable development, and what is the core competitiveness of enterprises? Answer the question comes from hardness practices, a comprehensivedevelopment strategy, creative and feasible for the companies in the industry ingeneral, Company SUFAT VIETNAM particular can be applied in practice within

5 years is essential Besides the functions strategies of Marketing, Finance ,

"Production Strategy for SUFAT Company Vietnam for the period 2017" played a very important role The analysis in the next chapter (the thesis

2013-content) will show Production-Operations is one of the core value chain createcompetitive advantages of the SUFAT VIET NAM company.

2 Thesis objects

1) Introduce all the resources involved in production activities in enterprises,systematic chain of operations by operated schemes; working process;statistics tables or operating notes…

2) To analyze the state of all production activities of SUFAT VIET NAMCompany at both view points: inside of enterprise and motorcycle productionsector in Vietnam, thereby making the review and evaluation of theseproblems exist, the objective and subjective reasons; their effects

3) On the basis of the above analysis, make recommendations; choose the bestProduction-Operations strategy with specific objectives and synchronizationsolutions in the implementation of the business.

3 Research Methodology

The way to approach and solve the problems of the thesis is briefly described

in the following scheme:

INFORMATION COLLECTION

OUTSIDE:

newspapers, internet…

consumers; insider sources…

INSIDE:

- Primary Information: from Company documents and books source; minutes

discusions; lessons learned from the past…

ANALYSIS:

- Working group discussions.

- Removes noise or unreliable information,

analysis to evaluate and draw conclusions.

ISSUES PROPOSAL

- Working group discussions

- Given the strengths, weaknesses, opportunities and threats.

PROPOSED STRATEGIES

- Working group discussions.

- Provide strategies to consider and choose.

With the current approach, the strategy may be larger than what the businessintends to plan or to implement According to the concept of Mintzberg, strategy

is a model of the flow of decisions and action plans This model can be any type

of strategy: pre-designed strategy or mutations strategy Modern approach makes

it easy for businesses to respond flexibly to changes in the business environmentand promote the creativity of the enterprise’s members However, it requiresleadership, management must have the ability to predict the conditions forimplementation of the strategy and assess the value of the mutation strategy

Through the above approach, we can understand that: the business strategy of

a business is the art of building long-term goals and the policies implementingaimed at orientation and create competitive advantage of enterprises

Characteristics of a firm's business strategy:

- The long-term orientation: business strategy set goals and determine thedirection of development of the business in the long term (3 years, 5 years, 10years) to orient in a business activityvolatile business

- The goal: business strategy often define the basic objectives, the businessorientation of each enterprise in each period and the policy in order to complywith the objectives set out

- Relevance: this requires enterprises when building business strategies need toassess the true state of their business activities At the same time must be regularlyreviewed and adjusted to suit the changes of the environment

- Continuity: business strategy must be reflected during continuous from theelaboration, implementation, assessment of strategic adjustment

- Business strategy in today's conditions can not be separated from thecompetition because of a business strategy to ensure business competitiveness inthe market In the current process of globalization, the business operations areconnected all over the world make up the influence and interdependence Sincethen has created fierce competition among enterprises in the same sector as well

as between sectors in the economy

1.1.2 The process of strategy formulation

(Source: Dr Vũ Thành Hưng

-Deputy Director of the Institute of Business Administration, from the University of National Economics )

Implement Strateric

goals setting

Strategy Control

"Strategies need more thanjust a dream A goodstrategy needs informationfrom many source andanalysis them It also takesthe right decision "

(Source: Thomas E Strateric Issues)

Ambler-1.1.3 The tools to analyze, evaluate and select strategies

1 PEST:

Used to analyze and evaluate the impact

of the external environment (macroenvironment) to the business operations

of the enterprise

2 PORTER’S FIVE FORCES

Used to analyze and evaluate the impact

of the external environment (industryenvironment) to the business operations

Used to assess the impact ofenvironmental factors external to thebusiness operations of the enterprise.

4 IFE (Internal Factors Enviroment)

Used to assess the impact of thesefactors within the internal businessoperations of the enterprise

5 7M & I

(Man; Material; Money; Machine;

Method; Management; Moral Value

and Informations)

Used to analyze and evaluate theresources and capacity of thedepartment within the enterprise

- WT strategy: limit the weaknesses tominimize the risk.

7 SPACE (Strategic Position Action

Evaluation)

Used to guide the strategy for the wholecompany SPACE matrix using 04measuring elements are:

- The financial strength of the business

- The attractiveness of the industry

- The stability of the externalenvironment

- The competitive advantage of thebusiness

8 QSPM (Quantitative Strategic

Planning Matrix)

Used to quantify the feasibility of each

of the strategies proposed in order tofind the priority one should be done:

- The main external factor

- The main internal factor

1.2 Production Strategy

1.2.1 Concept

According to Dr Alfred Sarkissian:

"Production or operational strategy is a set of decisions or reasons for the actionnecessary that an organizations need to enforce to produce goods and services.Production strategy showing that the operational functions of the business should

be given, the productive resources should be selected, deployed and controlled "Types of Production Operations strategy can be focused on the followingobjectives:

1) Quality: The quality of the goods and services provided must be consistent withthe standards and meet customer requirements Quality can be achieved through ahighly skilled labor force, appropriate technology and effective use of qualitystandards.

2) Speed: This strategy requires the provision of goods and services as fast ascustomers would want Speed can be achieved by reserves of raw materials,supply of materials quickly and effectively control the flow of work

3) Reliability: Ensure on time or delivery schedule promised to customers It isachieved by planning SX science, machinery and equipment reliability and thecommitment of the employees

4) Flexibility: Involves able to respond to changes in product design, order sizeand delivery time requested

5) Cost: Cost efficiency is achieved by using a reasonable capacity, reduce thecost, multifunction devices and increase productivity

1.2.2 Some modern models of Production Management

ISO 9001

ISO 9001 is a quality management system that, including the specializedquality management standards for specific industries This is a system oforganizational structure, processes, responsibilities and resources are clearlyidentified and used to evaluate the overall quality management efforts ISO 9001certification ensures the company's customers that systems and proceduresacceptable minimum is applied in the Company to ensure that minimum qualitystandards are met

Lean Manufacturing

Is a system of tools and methods to eliminate waste and inefficiency in theproduction process to reduce production costs thereby improving competitiveness.The goal of LEAN include:

1 Waste reduction and waste.

2 Reduce production cycle

3 Reduce inventory levels

4 Labor productivity growth

5 Utilization of equipment and

6 Sigma (6σ):

In the early 1980s, in an effort to enhance the highest quality for its products,the U.S.Company Motorola has initiated strict management model of theproduction process and begin to introduce the concept of 6 Sigma The success ofthis management model in Motorola has created a movement widely deployed in awide range of leading companies such as IBM, DEC, Allied Signal, GE, etc Sofar, this model not only been widely in the manufacturing sector but also in theservice sector with how tightly controlled the stage, the process provides themodel of 6 Sigma Many companies have been successfully deployed such asBombardier, Raytheon, Siemens, Nokia, Navistar, Wipro, Kodak, Sony, Siebe,3M, Polaroid, Citibank, ABB, Dupont, Lomega, Amex, Seagate , Black & Decker.Summary of this model are as follows:

- Improved performance of the process: event-based to address seriousquality issues with customers (Customer Critical to Quality CTQ);

- Improved customer satisfaction: increased responsibilities to customers,reduce customer dissatisfaction;

- Reduce costs: Reduce errors in product, service and delivery time, increaseefficiency, reduce waste

Highlights of 6-Sigma model is the use of statistical techniques to control theproduction process or service provider The process is designed to achieve thetransformation is determined through statistical techniques, analysis of the factorscausing the errors and trying to adjust to the process of achieving identified goals

The integrated model Lean-6 Sigma

It’s clearly that, to create products with the least cost, fastest delivery time, the

Lean model (Lean manufacturing) will help businesses increasing their

competitiveness and increase profitability However, quality aspects of theproduct / service is still a concerned matter Reality experience in a number ofenterprises in Vietnam shows the variation (heterogeneity) on product quality inthe manufacturing process / service still requires better control measures Somebusinesses with good support thanks to modern technology (eg automation), mayovercome this problem better, but still need to control the process Therefore,

combined with 6 Sigma model can help give your business a strict process control

methods, thereby stabilizing and reducing the variation in the quality of products /services provided

Compare characteristics of two models Lean and 6 Sigma

 Speed

 Minimize waste.

 Demonstrate activities value chain.

 Materials management at the right time.

 Stable statistical nature.

 The process can be predicted.

- Along promote the participation of people.Lean with Kaizen activities and

recommendations.6 Sigma with project team 6.

Different:

- Lean:speed and waste;6 Sigma:change and defect evaluation process;

- Use different tools Lean: identify value chain activities, time, visual management, PDCA, standardize work 6 Sigma: statistical process capability, the

sample design, the cost of quality, DMAIC,

- Lean: use the technical approach and efficient use of industrial equipment in general; 6 Sigma: use of statistical evaluation, analysis of variation and statistical

optimization

Two these models combined together will form a very effective managementstrategies One to reduce management costs, the other to improve the quality andreduce process variation of the product / service provided For each model, tools,specific techniques will need to be selected to work together, as well as inaccordance with the actual conditions of the business The ultimate goal is to helpbusinesses meet the requirements of the customers in the best way, the mosteffective

Address : Industrial Pa rk Pho Noi B, Hung yen Province

Estaplishment year: 1996

Number of employees: 300 persons

Average revenue of the 3 recent years (mil VND): 300,000 mil VND/yearBusiness areas : Motorcycle Manufacturing

Factory: Industrial Park

PhoNoi B, HungYen Model 2010: Sufat Fivemost Processing Workshop

2.1.2 The process of formation and development:

 1996-1999 :

On 8thAgust, 1996 as the date established businesses with the first name is:Company Name: PHAM TU CO., LTD

Office: 248B Tay Son Dong Da District, Hanoi

Registered business lines: capital goods, consumer trade (mostly motorcycles).Charter capital: 100 million VND

1996: Company's operations mainly in the business of old motorcycle (secondhand) imported from Japan Sales reached 6000 units / year, mainly wholesale

1997-1998: Vietnamese Government begins banned old motorcycle, thecompany moved to import the new vehicles (mainly Wave style motorcycle fromThailand and then to Laos in the form of barter) This stage sales reached 11,000units/year.

1998-1999: Motorcycle China entering the Vietnamese market, PHAM TU.CO., LTD makes a joint venture with a number of domestic companies whichhave quota to import motorcycle components (primarily China) assembled inVietnam

In late 1999, the idea of strategic shift from mere business to invest inproduction appear in the launch of the project team for the Board of Directorswith the task of setting up viable projects for investment to lease land,construction of buildings, procurement of machinery and equipment, inviteexperts to prepare a plant to produce, assembly motorcycle.

 2000 - 2001:

15 November, 2000 Project "Vietnam-China factory producing and assemblymotorbike engines parts” PHAM TU Co.,Ltd as investors approved by Hung YenPeople's Committee

Location: PhoNoi B Hung Yen province

The total lease area: 44 685 m2

Lease term: 35 years

Total initial investment: 74 billion and 255 million VND

Start a period to implement both phase together: factory construction andmotocycle production One hand have to assembly many motorcycles to promotebusiness, consumption in order to get money for investment back to the plant, onthe other hand have to quickly complete construction categories: infrastructure,electricity, water, ground workshop In late 2001, the first workshops of thefactory is: workshops motorized, car assembly, welding, painting activities

 2002 - 2005:

After a long process of development, the enterprise has grown constantly in sizeand production capacity SUFAT brand has initially been confirmed in themarketplace associated with product quality reputation Some of the followingchanges:

Business name: SUFAT VIET NAM Company

Office: PhoNoi B Hung Yen province

Total investment: 167 billion VND

Lines of business registration:

- Produce detailed engine and motorcycle parts

- Assemble engine motorcycle

- Installation of motorcycle

- Trading of consumer materials (mostly motorcycles)

- Manufacture of automotive parts, automotive engine assembly, automotiveassembly types

Charter capital: 106 billion VND

 2006 until now:

SUFATVIETNAM CO started building Vietnamese motorcycle brand, somenew products such as the Backhand (2005); Retot (2006); Labour (2008 on theoccasion of the Company was awarded the Labor medal); Thousand (2010-1000thanniversary of Thang Long-Hanoi); XV-125 (2011)…have brought SUFATbrands becoming closer to consumers, and created fierce competition with otherfamous brandsmarket

2.2 Analysis of factors within the enterprise.

2.2.1 Analysis and assessment of resources in the enterprise (7M)

(7M: man; material; machine; money; method; management; maral value andinformations)

Tangible resources:

1) Finance:

Net profit from business

Here:

Margin Profit MP = NI/TR

BEP = EBIT /Asset

ROA = Net income / Asset

ROE = Net income / Total common shares

(Source: Company Data –July, 2012)

All the criterias MP, BEP and ROA are low, compared with the norm of thecorresponding sector is 12%; 16% and 8%, it shows that SUFAT VIETNAMCompany is experiencing difficulties in production and business activities

Evaluate: 1/5 marks

2) Organization:

SUFAT VIETNAM Company was founded in 1996 as a private enterprise, notequitization and listing on the Stock Exchange to become public company.Organization chart as follows:

Chart 2.2.1d

Bussiness Manager

3) Assets:

a Land:

- Location: SUFAT VIETNAM COMPANY located at km 28thalong Hanoi - HaiPhong highway, addressed PhoNoi B Industrial Zone Hung Yen Yen province,very favorable terms of transport both by road and by waterway (Hai Phong port)

- The auxiliary works (stations; the internalcontainer yard ): 20,000 m2

a) Equipments:

- Quantity: 15 pcs

- Clamp force: 80-1000 tons

- Manufacturer: HAITHIEN-China, Taiwan

- Quantity: 04 pcs

- Clamp force: 250-850 tons

- Manufacturer: UBE - Japan

- Quantity: 08 pcs

- Welding current max: 320-400 amps

- Manufacturer: KEMPPI Finland

4 CNC Milling:

- Quantity: 04 pcs

- Processing scope: X850mm;Y520mm; Z560mm

- Manufacturer: VICTOR - Taiwan

- Quantity: 01 pcs

- Measuring range: 300 x 500 x 300mm

- Manufacturer: MITUTOYO - Japan

- Quantity: 01 pcs

- Power measurement max: 10 kW

- Speed measurement max: 10 000 cycles / minute

- Manufacturer: VICTOR-Federal Republic of

Germany

- Quantity: 03 pcs

- Processing scope: X = 260mm; axis Z = 350mm

- Manufacturer: COSMOS - Taiwan

Remark:

The plant of SUFATVIETNAM Company is fairly complete, installated ofmachinery and equipment with a maximum capacity can reach 100,000 vehicles /year Favorable position to supply inputs as well as the distribution vehicle outputfor both domestic market and export

Evaluate: 4/5 marks

4) Technology:

Since the early years of construction and development (2001-2005), manysolutions advanced technologies have been applied for SUFAT VIETNAMCompany in the field of research as well as the production to ensure that willbring the highest quality and productivity as including:

a Plastic spray

Complete details including plastic car headlights, taillights, is shaped by plasticinjection technology in high-pressure liquid and spray rate is quite large in theclosed mold to ensure the accuracy of shape size , consistency of the material

- The maximum injection pressure: 140 bar

- The maximum injection rate: 99 cm / s

b Semi-automatic MIG welding

The semi-automatic welding under a layer of CO2 gas protection combined withdedicated fixtures to apply than the discrete details embryo is created by theprevious method of stamping, bending, cutting into the product frame, handlebar, foot combat, as, box chain complete

Maximum amperage: 40 - 400A (15 - 34V)

Wire-speed automatic level: 0 - 18m/min

c Casting

The details are materials made from aluminum alloy, such as cabinet, wallmachines, moayo, fairer, cow cap, cylinder is formed by applying pressurecasting technology in the closed mold with extreme speed injection faster withhigh productivity, product uniformity, high surface smoothness

Maximum firing pressure: 264.6 - 640 kN

Maximum Rate of fire: 1000 - 4500 mm / s

d Precision machining

Next the molding passage, the details cover, wall machines, moayo, rifle butts,bull cap, cylinder be transferred to a process of exact line of cutting machinesand CNC machining machine dedicated to ensure:

Accuracy size: levels 2-4

Achieve smooth surface: ▼ 6 - ▼ 9

f Powder coating

To protect the metal parts of the car against the corrosive effects of theenvironment to ensure durability and useful life, coating technology has beenapplied from the company early on in both formats:

Embedded electrostatic paint: primer used to detail the chassis, handle bar, themore, the box chain before color coat the outside The advantage is that theentire surface to paint even more complex is to ensure this is some paint withouterrors

Electrostatic powder coating: coatings paints for vehicles subject to details ofworking conditions are relatively harsh, bear rubbing collision such as a tripodstand, against the edge, rack legs the advantage of creating surface coating onhigh quality thick and hard

g Quality inspection

The complete inspection is implemented on modern testing equipments for twofinished products are: engine, and motorcycles The engine will be is tested on 3parameters equipment and the motorcycle on 8 parameters equipment Suchengines and motorcycles are shipped under the SUFAT standard criteria

Rmark:

Production technology is rather modern and completion, it’s strong point ofSUFAT VIETNAM Company It’s equivalent in compared with the FDIenterprises and totally superior to the remaining domestic companies

Evaluate: 4/5 marks.

Intangible resources:

5) The capacity of employees:

Work skills and general knowledge level of SUFAT VIETNAM Company staffswere formed and developed primarily from two sources: self-training andexperience drawn from actual business performance Supplemented with the bestpersonel from outside sources is very limited as the salary and work environment

is low

Chart 2.2.1f

Education of employees SUFAT VIETNAM CO., LTD

Trung cấp Bằng nghề LĐPT

(Source: Company Data, July, 2012)

In addition, under the pressure of the Vietnamese labor market in recent years,the personnel change in the order: “probation - familiar - well done – quit” occursfrequently cause the productivity and work efficiency of the whole company werenot stable

Evaluate: 2/5 marks

6)Thinking innovation:

Intellectual Property Organization (WIPO) has announced the index rankings

of global technology innovation including in Vietnam ranked 76, this is thesecond year than to Switzerland, Sweden and Singapore lead first in the rankingswith 141 countries Rankings of some countries in Southeast Asia such asThailand in different positions: 57, Cambodia 129, Laos 138, Indonesia 100,Philippines: 95 Malaysia: 32

(Source: vnexpress.net Thursday, 05/07/2012)

But in SUFAT VIETNAM Company tangible resources generated frominnovative thinking, creativity is not rated higher Reasons:

- Thinking of innovation leadership is slow, many years have passed but thethinking, not making many changes The door to diversify the product or openanother line of business is almost always closed Example: 12 years of business

performance is only a number of ordinary cars, there are no other adjacent productlines such as scooter (scooter) or large cylinder motorcycles

- No incentives, encourage innovation found in the Company Individual rolesshould always be rejected, although in some departments there are always parts ofproposals and initiatives but quickly immersed

- Education, general knowledge in Company were at the average level

Remark:

Considering the above criteria: background / motivation / and knowledge baseand revaluating operation process of 15 years, the innovation, creativity are notstrong points of SUFAT VIETNAM Company

Evaluate: 2/5 mark

7) Raputation:

Branding is one of the long-term strategic objectives of SUFAT VIETNAMCompany Annual operating costs for communications, branding and publicrelations of the company is about 6-8 billion VND (2.5% of sales)

RESEARCH AND DEVELOPMENT PROGRAM MARKET 2012

Table 2.2.1g

Target Indicators Objects

2012 Unit Density Action Plan Division

The duration

Marketing Dept

April, 2012

characteristic Eco Fivemost

Marketing Dept July, 2012Increased rate

India, Myanmar, Nigeria, Morocco

of the region, implementation and evaluation

of objectives, often results

(Source: Company document –January, 2012)

However, the results were not as expected because the way of building brandwas not unific and continuous, in the other side the cost is still very small incompared with other major brands

Considering the five criterias for evaluating the level of brand, SUFAT are atbetween 2ndand 3rdlevel (2nd: the unrecognized brand; 3rd: the recognized brand)

Evaluate: 2/5 marks

2.2.2 Analysis and assessment of the functioning process in company

(MF-HR-O-R & D, etc.)

- Poor market forecast

- Works with customer care (CRM) discrete, unprofessional

- Qualification, (export-import operations; foreign language, etc.) is limitedespecially when expanding overseas market

Sales Deparrtment

Dealer I

Service Parts

Order

Dealer II

Sales Directors

Marketing Development

Packing

P.R Customers

Production process in SUFAT VIỆT NAM Company was showed as follow:

Production Plan is built on the basis of of orders from Sales Department on the20-25 of every month, then Materials Department undertaking contracts withsuppliers to provide materials for both production and spare parts for assembly in

the factory This is the production model following the 6 Sigma management

system style in conjunction with the ISO 9001-2000 great attention to control thestability of product quality

3) Research & Development:

The motorcycles production and assembly Industry in Vietnam really began

Production Planning

Delivery materials, components…

Production process: welding;

plastic ịnjection; painting…

since the early 90's but has grown quite fast However, in the field of motorcycledesign (especially design new styles) according to the Ministry of Industry:

"Because there are limited financial, technical and management level design ,the firms do not have a quality product and own designs but usually simulate theexited old designs Copy strategy and innovation have created standardizedprocesses domestic motorcycle products at low prices "

(Source: The Strategy Developing of Vietnamese motorcycle industry in 2015)

VIETNAM SUFAT Company is the first business started building R & Dcenter by its own way Topic "Application of CAD / CAM in the design andmanufacture of motorcycles in Vietnam brand Sufat" hosted by the company withthe support of funding from the state budget through Science and TechnologyContract No 12/2006 / HDKHCN-DN on 28/9/2007 is a part of this programe.From 2004-2011, the Company's R & D center has introduced nine newmodels with half of them has been the Department of Intellectual Property,Ministry of Science and Technology grant patent protection to meet demandratherchange of tastes and designs of the market at the same time overcome thenew challenges of design protection, intellectual property, design piracy but theprocess of WTO accession brings

Remark:

Research and development function is a significant competitive advantage ofSUFAT VIETNAM Company in comparison with competitors in the sameindustry The only weakness is the personnel to maintain the operation and

Sketch

design

Create 3D form

Scan 3D Reverse

design

Mould design

development of this department, lack of skill engineers, professionals come herefor the job.

Evaluate: 4/5 marks

4) Information Management:

SUFAT VIETNAM Company is one of the businesses of manufacturing andassembly of motorcycles has invested early to build not only the IS in enterprise

in stage 1 of the e-Commerce such as:

- Procurement of computers, email, set up website

- Transactions with customers, suppliers by email

- Find information, promote or advertise business of company on the web

- Support customers for products and services

but also in stage 2 of the e-Commerce process such as:

- Develop internal network (LAN), network server website with data sharingbetween departments within enterprise

- Application many softwares: design, personnel management, accounting,inventory management

Chart 2.2.2a

Summary datas:

CÔNG TY SUFAT VIỆT NAM

Internal network (LAN):

48 HUB and 48 IP for each desktop

be seen this as a strength of SUFAT VIETNAM Company.

Evaluate: 4/5 marks

2.2.3 Analysis and assessment of competitive advantage

1) To identify valuable resources and core

Set of evaluation in item 2.3.1 (resources), item 2.3.2 (capacity) and try tointegrate them into the data table which will help us identify what is the specificcapacity of the SUFAT VIETNAM Company:

52/125 (42%)

68/150 (45%)

Evaluated results in Table 2.2.3 show that in SUFAT VIETNAM Company:

Valuable resources as:

ii) Factory; machine and equipment

iii) Technology level and experience

The core competencies as:

i) Production

ii) Information Management

iii) R & D

2) Evaluate core competencies

So valuable resources and core competencies of SUFAT VIETNAM Companyhave been identified The question now is: compared to its competitors in thesame industry (mainly taking into account the domestic enterprises) the strategyshould focus on where to be able to create a competitive advantage for theSUFAT VIET NAM Company?

Marked checkerboard area includes two orientations is suitable as Cost and

Quality However, the two orientations are seen as contradictory in practice So

we will continue to review the following to make the best strategic proposals

2.2.4 Build the IFE matrix

Table 2.2.4

Analysis of internal factors (IFE)

1 Facilities and technological capabilities

sufficient to meet the quantity and

quality of products according to market

requirements

2 Information technology system is pretty

good organization, to meet the

development requirements for both

inside and outside the company

4 15 years of accumulated experience and

expertise in the motorcycle industry

5 SUFAT Motorcycles brand name start

is known for the quality and good

design

Cost

Speed Quality

1 Weak financial, loan rate on equity is an

imbalance Maintain working capital for

production and business activities is

very difficult, no more to mention the

investment activities

2 Lack of senior personnel, more and

more missing because there is no

supplement

3 Thinking of leadership were slow,

conservative, the lack of a sustainable

development strategy.

4 The organizational structure is quite

bulky, functional model but the lack of

separation of powers

5 Production management is not so good ,

more waste and losses Production costs

Score 2.3 shows that SUFAT VIETNAM Company is not without resources, or

competitiveness but to turn them into core competencies, specific, seems to bedifficult

2.3 Analyse Production Situation in SUFAT VIET NAM Company.

2.3.1 Summary of Industry environment

Vietnam's motorcycle industry is formed over the last 10 years and particularlyrapidly developed in the period 2001-2005 Apart from the first four foreign-invested motorcycle-manufacturers developed in the 1990s is VMEP (1984),

Honda, Yamaha, Suzuki (1986), untill now has appeared many domesticenterprises manufacture and assembly of motorcycles, original works on the basis

of the source components and spare parts imported from China

Before 2000, the annual motorcycle output was a few hundred thousand units,mainly due to the FDI and domestic enterprises imported complet parts forassembly Sales price at this time is relatively high for the income of theconsumer

After 2000, some domestic enterprises have invested common motorcycleassembly line with almost components originating from China and a part fromdomestic makers Due to price match the income of consumers to theconsumption of the domestic business has skyrocketed In 2001 the production-assembly enterprises accounted for 80% of domestic consumption sector

The competitive pressure of the domestic firms, FDI has revised businessstrategy, organization of production, design changes, development of productionsystems support, after-sales service, reducing the price of products and thusincrease sales volume annually Whereas with gradually improved standard ofliving, the demand for quality motorcycle consumers should also improveconsumption low price motorcycle parts of Chinese origin significantly reduced.This is the main reason quickly reduce the number of domestic production-assembly enterprises

In 2005, motorcycle sales volume of FDI accounted for 61.63% of theconsumption sector

During the period 2001-2005, according to the Vietnam Register, there are 54enterprises producing-assembly activities and motorcycle business with thehighest annual assembly output is about 2.4 million units Including fourenterprises with output of more than 100,000 vehicles, 6 enterprises withproduction of over 40,000 units, 10 enterprises with the capacity from 20,000 to40,000 units, and 17 businesses output from car 10-20000 / year The rest arebusinesses with less than 10,000 vehicles / year

Production support system was gradually formed with hundreds of enterprises

of various economic sectors, both domestic and foreign

The domestic motorcycles assembly-production situation

(Source: Data of the Vietnamese Register Dept)

By 2006 the proportion of the output of local firms of under 40,000 units / yearand especially less than 20,000 units / year has been significantly reduced About

18 companies (both FDI and domestic) account for nearly 88% of the totalnational motorcycles production However, there exist a number of businessesoperating in moderation seasonal style, with less than 10,000 vehicles/year