Building business strategy at bank for investment and development of vietnam – tu liem branch in the phase of 2017 2021

20 CHAPTER 2: CASE ANALYSIS OF JOINT STOCK COMMERCIAL BANK FOR INVESTMENT AND DEVELOPMENT OF VIET NAM – TU LIEM BRANCH .... About Joint Stock Commercial Bank for Investment and Developme

ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH

TỪ LIÊM TRONG GIAI ĐOẠN 2017 – 2021

LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

HÀ NỘI - 2018

ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH

TỪ LIÊM TRONG GIAI ĐOẠN 2017 – 2021

Chuyên ngành: Quản trị kinh doanh

Mã số: 60 34 01 02 LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

NGƯỜI HƯỚNG DẪN KHOA HỌC: PGS.TS NGUYỄN NGỌC THẮNG

Hà Nội - 2018

DECLARATION

The author confirms that the research outcome in the thesis is the result of author’s independent work during study and research period and it is not yet published in other’s research and article

The other’s research result and documentation (extraction, table, figure, formula, and other document) used in the thesis are cited properly and the permission (if required) is given

The author is responsible in front of the Thesis Assessment Committee, Hanoi School of Business, and the laws for above-mentioned declaration

Hanoi, date of …… / …… /……

Do Dai Duong

ACKNOWLEDGEMENT

I hereby certify that I am the sole author of this thesis and no part of this thesis has been published or submitted for publication I certify that, my thesis does not violate anyone’s copyright Additionally, all ideas, quotations, or material from the work of other people included in my thesis, published or otherwise, are fully acknowledged with the standard of references

I declare that this is a true copy of my thesis The content of this thesis has been approved by the committee of Vietnam National University, Hanoi – Hanoi School of Business (HSB) This thesis has not been submitted for a higher degree to any other University or Institution

In order to finish this project successfully, I have received many helps, supports and guidance from many people who I would like to thank sincerely

First of all, I would like to thank all the professors of MBA program, especially PSD, Dr Nguyen Ngoc Thang – my suporvisor Then I would like to thank deeply the respondents and interviewees who allowed me to gather enough data for this research Finally, I would like to express my thanks to my family, my colleges and my fellow friends who created convenient conditions and give me encouragement and understanding for me to complete this degree

I sincerely thank you!

Hanoi, date of …… / …… /……

Do Dai Duong

TABLE OF CONTENTS

LIST OF ACRONYMS i

LIST OF FIGURE, TABLES ii

HEADING 1

CHAPTER 1: RATIONALES ON BUSINESS STRATEGY OF THE ENTERPRISES 4

1.1 The concepts of business strategy of the enterprises 4

1.2 Characteristics of Business Strategy 5

1.3 Requirements of business strategy for enterprises 6

1.4 Purpose, objective necessity of building business strategy 6

1.5 Process of business strategy development 7

1.5.1 Targeting 7

1.5.2 Analyzing the basics of business strategy development: 8

1.6 Tool to provide information for strategy development: 15

1.6.1 Internal Factor Matrix (IFE): 15

1.6.2 External Factor Matrix (EFE): 15

1.6.3 Competitive Image Matrix: 16

1.7 Strategy development and selection: 16

1.7.1 Matrix strengths - weaknesses, opportunities - risk (SWOT): 16

1.7.2 Strategic planning matrices can be selected 17

CONCLUSION CHAPTER 1 20

CHAPTER 2: CASE ANALYSIS OF JOINT STOCK COMMERCIAL BANK FOR INVESTMENT AND DEVELOPMENT OF VIET NAM – TU LIEM BRANCH 21

2.1 Overview of the Joint Stock Commercial Bank for Investment and Development of Viet Nam 21

2.2 About Joint Stock Commercial Bank for Investment and Development of Viet Nam - Tu Liem Branch: 21

2.2.1 Formation and development process: 21

2.2.2 Business activities of Tu Liem Branch: 22

2.2.3 Products and services: 24

2.2.4 Analysis of business activities of BIDV Tu Liem in 2016: 24

2.3 Analysis of external factors affecting the operation of BIDV Tu Liem: 27

2.3.1 Macroeconomic Analysis: 27

2.3.2 Micro-environment analysis (sectoral environment): 33

2.3.3 Assessment of opportunities and challenges: 44

2.3.4 Matrix of external factors 45

2.4 Internal factor analysis of BIDV Tu Liem: 47

2.4.1 Human resources factor 47

2.4.2 Accounting and financial factors: 48

2.4.3 Research, Development and Marketing: 49

2.4.4 Information technology: 49

2.4.5 Assessment of strengths and weaknesses: 49

2.4.6 Matrix of internal factors: 50

CONCLUSION CHAPTER 2 52

CHAPTER 3: BUILDING THE BUSINESS STRATEGY OF JOINT STOCK BANK FOR INVESTMENT AND DEVELOPMENTOF VIETNAM – TU LIEM BRANCH IN THE PHASE OF 2017-2021 53

3.1 Business objective of BIDV Tu Liem period 2017 - 2021: 53

3.1.1 Strategic direction of BIDV in 2016-2020 53

3.1.2 The objectives of BIDV Tu Liem in the coming time: 55

3.2 Strategic Analysis and Selection: 56

3.2.1 Use the SWOT matrix to select business strategies: 56

3.2.2 Analyze strengths, weaknesses, opportunities and challenges of BIDV Tu Liem through the SWOT model 57

3.2.3 Business Strategy Selection - QSPM matrix: 59

3.3 Specific strategies: 60

3.3.1 Firstly, the strategy of developing products and services: 61

* Overall objective: 61

3.3.2 Second, capital development strategy: 62

3.3.3 Third, credit growth strategy: 63

3.3.4 Fourth, training strategy and human resource development: 64

3.4 Some solutions to implement the business strategy of BIDV Tu Liem in period 2017 - 2021: 64

3.4.1 Capital operation 64

3.4.2 Credit activities: 65

3.4.3 Service activities: 66

3.4.4 Technology development: 67

CONCLUSION CHAPTER 3 68

CONCLUSIONS AND RECOMMENDATIONS 69

2.2 For the State Bank of Vietnam 72

REFERENCES 75

Joint Stock Commercial Bank for Investment and Development

of Vietnam - Tu Liem Branch Vietnam Joint Stock Commercial Bank for Industry and Trade Bank for Agriculture and Rural Development

Saigon Thuong Tin Commercial Joint Stock Bank Automatic payment machine

Information via mobile phone Matrix evaluates external factors Matrix evaluates internal factors Matrix Strengths-Weaknesses, Opportunities-Risk Matrix Strategic Positions and Assessment Activities Matrix Teams Consulted Boston

Matrix of internal-external factors

LIST OF FIGURE

Figure 1.1 PEST model 8

Figure 1.2 The force model of M.Porter 10

Figure 1.3 Model of choice of factors affecting business performance 13

Figure 1.4 Schematic diagram of SWOT 17

Figure 1.5 BCG matrix 18

Figure 2.1 Organizational model of BIDV Tu Liem 22

LIST OFTABLES

Table 2.1 Update of business results of BIDV Tu Liem 30/06/2017 22

Table 2.2 Evaluation of business results of BIDV Tu Liem 31/12/2016 24

Table 2.3: Population pyramid chart of Vietnam in 2016 31

Table 2.4 Credit outstanding, capital mobilized by banks 2016 35

Table 2.5 Comparison of NPL ratios, risk management of banks 36

Table 2.6 Profit before tax and net service income of banks 36

Table 2.7 Correlation of scale, performance and net interest income of banks 37

Table 2.8 Financial indicators for banks in 2016 37

Table 2.9 Network development of banks in the period 2011-2015 37

Table 2.10 Relationship between GDP Growth and Credit 38

Table 2.11 EFE matrix 46

Table 2.12 Human Resources of BIDV Tu Liem 47

Table 2.13 Matrix of elements within the IFE 50

Table 3.1 BIDV's objectives for 2016-2020 54

Table 3.2 Targets of BIDV Tu Liem in 2017-2021 56

Table 3.3: SWOT matrix 57

Table 3.4: QSPM matrix 59

HEADING

1 Reason for selecting the topic

The Fourth Industrial Revolution has been coming This is unprecedented revolution in human history, it will evolve very fast, is a combination of technology

in the fields of physics, digitization and biology, creating entirely new possibilities and has a profound impact on the political, social and economic systems of the world More than ever, the only thing that businesses can know for sure is change Therefore, building and managing a strategy as a way to help businesses overcome the turbulent in the market, reaching a future, by their own efforts and capabilities

In Vietnam, businesses have been facing many difficulties arising from the strong competition when opening the market A business that wants to succeed needs to be able to cope with every situation, be independent, make decisions and take responsibility for all activities Therefore, businesses need to grasp the trend is changing, to exploit the strengths, limit the weaknesses, take advantage of opportunity to overcome the challenge, thereby creating creative steps for themselves , in other words, build a proper business strategy

Joint stock commercial Bank for Investment and Development of Viet Nam (BIDV) is one of the four largest commercial banks in Vietnam, which is undergoing a shift towards globalization and international economic integration With 60 years of development and development, BIDV has achieved many successes in business activities BIDV's reputation in the international market has been affirmed as the leading financial institution in the financial institutions in Vietnam

Based on these perceptions and practices, who has worked for many years at BIDV, is currently working at the Joint stock commercial Bank for Investment and Development of Viet Nam – Tu Liem Branch- a member of BIDV Along with the knowledge gained from the MBA course of the Faculty of Business Administration

- Hanoi National University, I chose the topic "Building business strategy of the Joint stock commercial Bank for Investment and Development of Viet Nam - Tu Liem Branch in the phase of 2017 - 2021 "as his dissertation topic

2 Research objects and scope of research

The subject of the dissertation is business strategy of Joint stock commercial Bank for Investment and Development of Viet Nam - Tu Liem Branch

The scope of the research is the business activity of BIDV Tu Liem, compared with the overall business of BIDV and other competitors in the industry, mainly commercial banks Vietcombank, VietinBank, Bank for Agriculture and

Rural Development (Agribank) and other commercial joint stock banks in the area

3 Objectives and objectives of the study:

3.1 Purpose of the thesis:

Developing a business strategy for BIDV Tu Liem between 2017 and 2021 and proposing solutions to implement this strategy to make BIDV Tu Liem one of the strongest branches in the BIDV system and in the local area of Hanoi City

3.2 Objectives of the study:

- Summarize basic theoretical issues related to business strategy planning, strategy development, strategic development tools

- Analyze the external factors, internal factors to find strengths, weaknesses, opportunities - risk of BIDV Tu Liem in relation to the BIDV system in general

- Define business objectives based on strengths, weaknesses, opportunities and threats, develop business strategies and propose solutions to implement those strategies on the basis of BIDV overall assessment in general and BIDV Tu Liem in particular

4 Research Methodology:

The lecture was completed on the basis of using the following research methods: Methodology of theoretical study, combined with practical research at Tu Liem BIDV; Secondary and primary data collection methods; Professional solution; Methods of analysis, collation and synthesis Combining the use of course methods: Strategic Management, Human Resource Management, Marketing

Sources of information: The thesis uses secondary information from books, magazines, wesite (asset.com, bidv.com.vn, vietinbank.com.vn .), published reports of Vietcombank, Vietinbank, Agribank at the State Bank

5 The structure of the thesis:

The thesis consists of 3 chapters and introductory sections:

Chapter 1: Theories of business strategy of enterprises

Chapter 2: Current Situation of Business Operations of Joint stock commercial Bank for Investment and Development of Viet Nam - Tu Liem Branch

Chapter 3: Business Strategy for Vietnam Development Investment Bank -

Tu Liem Branch 2017 - 2021

The main content of each chapter is presented below

CHAPTER 1 RATIONALES ON BUSINESS STRATEGY OF THE ENTERPRISES

1.1 The concepts of business strategy of the enterprises

The first strategic term used in the military field Gradually, the strategy is used in other areas of socio-economic life The term "strategy" is a combination of the word war, that is fighting, fighting and combing, that is, intrigue Thus, in the original, the strategy is to fight and more importantly to win

Today, the term has been used in almost all fields: economics, politics and culture In the field of economics, at the macro level we may have concepts such as

"sectoral development strategy", "export-oriented industrialization strategy", level, Combined with corporate management, the term "marketing strategy",

micro-"production strategy", "business strategy" is formed Due to the different approaches to strategy that The concept of strategy is different, so far there is not a common, consistent concept of this category In the field of economics, the scope of the strategy applied to enterprises may take into account some of the following concepts:

"Strategy is the deciding factor of the organization's long-term goals" (Prof Alfred D Chandler, 1962);

"Strategy is a red thread throughout the organization's operations" (Prof H Igor Ansoff, 1965);

"Strategy is the art of creating competitive advantages" (M Porter, 1980)

"The strategy is to outline the long-term, stable enough orbits around the trajectory that can make the right decisions and the actions of the business" (Alain Charles Martinet, 1983)

"A strategy is defined as a plan or business plan that guides or directs the organization to the desired goal This general operating plan provides the basis for policies (orientation for decision approval) and operational procedures "(Garry D Smith, Danny R Arnold, Bopby G Bizrell "Business Strategy and Strategy")

In general, these concepts of strategic terminology are inclusive and reflect:

+ The objectives of the strategy;

+ Time of implementation;

+ Strategic decision making;

+ Competitive environment factor;

+ Advantages and disadvantages in general and in each activity in particular

So, we see the strategy of the business is a "product" that combines what the environment has? What business can? And what businesses want?

Together: In business, a strategy is to be understood as a design art, a means

of achieving long-term goals and a relationship with a changing and competitive environment A good business strategy is a strategy in which a company can gain a competitive advantage over competitors at an acceptable cost To better understand the business strategy category, we need to consider its characteristics so that we can distinguish it from related concepts and categories

1.2 Characteristics of Business Strategy

Business strategy often defines the basic objectives and business directions

of each enterprise in each period and is fully understood in all aspects of production and business activities to ensure Business development is continuous and sustainable (more than 1 year)

Business strategy ensures maximum mobilization and combines the exploitation and use of resources of enterprises in the present and future, bringing into play the advantages and grasp opportunities to win the market business

Business strategies must be reflected throughout a continuous process from formulation, implementation, inspection, evaluation and strategic revision

Business strategy is usually built for a relatively long period (3 years to 5 years), tendency to shorten down depending on the characteristics of each sector

From the above characteristics, it is easy to distinguish the strategic category from related concepts and categories The concept closest to the strategy is "plan",

in fact many people mistakenly confuse the two concepts together The striking feature of the strategy is the direction and identification of major solutions and policies to the main objectives, while the alignment plans are mainstream, all goals

are quantified This is a system of indicators reflecting the comprehensive production and business activities of enterprises

1.3 Requirements of business strategy for enterprises

One key feature of this feature is that it clearly defines the business scope of the business This is an important step in business analytics, strategic direction, resource allocation, and portfolio management Two basic questions to ask are: What business are we doing? And what business should we do?

This is a relatively complex issue as the market segmentation process has a huge impact on the organizational structure of the business

Business strategy creates a mutually supportive relationship with the opportunities and challenges outside the enterprise, the strengths and weaknesses of the business, and thus create the competitive edge of the business

This feature highlights a key issue of the strategy that is to create a sustainable long-term competitive advantage over the main business competitors in the business sector in which the business engages This is a modern approach that is used to study the competitive position of the business

1.4 Purpose, objective necessity of building business strategy

Building a business strategy is one of the most important activities of senior managers A non-strategic organization is like a rudderless ship Without a proper strategy implemented effectively, failures are almost certain Building a business strategy that brings practical benefits to the business is:

Help your business see its future in the future so that executives will consider and decide when and how to reach the target

Helps administrators stay motivated by environmental changes: Helps administrators clearly see opportunities and threats in the current business environment to analyze, evaluate and forecast conditions business environment in the future This helps the company take advantage of opportunities, repel the risk to win the competition, win

Helping businesses maximize and exploit their resources thus promoting the maximum strength of the business to grow up; Allocate resources from one place to another in a rational manner

Helping businesses increase the alignment of employees and administrators

in the implementation of corporate goals, thereby creating the internal strength of the business Help businesses increase sales, increase employee productivity and increase governance, avoid risks, increase prevention and prevent problems for businesses

1.5 Process of business strategy development

1.5.1 Targeting

Strategic goals are the desired goals of the business It is to specify the purpose of the business in terms of direction, scale, structure and implementation process over time In the market economy, businesses generally pursue three main purposes: existence, development and diversification The strategic target system also expresses the desire to achieve certain results during the strategic period There are usually two types of objectives: short-term and long-term

Long-term goal: is the final desirable result that the business wants to achieve over a period of more than a year, with the specific content: profitability, productivity, competitive position, employment, community relations, technology position, social responsibility

Short-term goals: These are the specific results an enterprise expects to achieve in a cycle, quantified

When defining the target system, the following requirements must be met: Specificity: Objectives must be clearly defined in each period, must have common goals and objectives

Linking: Goals must ensure cohesion, mutual reciprocity, or otherwise, in achieving this goal, without interfering with the achievement of other objectives Priority: Define the priority of each objective and the hierarchy of each goal Flexibility: The objectives set out need to be flexible enough to be adapted to the changing business environment

Feasibility: The goal must balance the difficulty and the reality

Quantitative: Targets must be defined in a measurable or quantifiable form

Rationality: The goal must be accepted and fully understood by the implementers

1.5.2 Analyzing the basics of business strategy development:

1.5.2.1 Macroeconomic Analysis:

For macro-economic analysis, the PEST theory includes assessments of political (P), economic (E), social (S), and (T) and threatening to businesses operating in that business environment

Factors of political law are the foundation for shaping other elements of the business environment, which means the political platform, and the legal environment that has that business environment These factors include the political system, the legal system Lenin said: "There is no political issue, no pursuit of economic gain and no economic problem for political ends." Therefore, if the political system is stable, the political path is clearly open, creating opportunities for businesses and vice versa Apart from analyzing the legal elements of the host country, enterprises must also study the legal environment of the countries where the investment-oriented enterprises come

Figure 1.1 PEST model

- Lifestyle etnamese people, culture

- Customs and habits

(Technological)

- Discover new technology

- Speed of technology transfer

- Government spending on R & D

+ The economic factors play the most important role in these factors affecting the business activities of enterprises It includes factors such as economic growth rate, exchange rate, inflation rate, interest rate policy, economic policy If the rate

of growth of the economy is high, the exchange rate increases , stable inflation rate, appropriate interest rate policy, economic policy to create a level playing field for businesses, it is an opportunity for businesses In contrast, these factors will create challenges for businesses operating in that economy

+ Cultural and socio-cultural factors have a slow impact on the business environment but have a strong impact by influencing market demand such as changing customs and habits

+ In the real estate business, population and demographic characteristics play

an especially important role in creating markets for the industry The size of population, population density, consumption habits, habits of people and demographic characteristics by age, ethnicity, distribution have a great impact on the sector

+ Technological factors play an increasingly important role in determining the business environment of enterprises in two directions Technology technology directly affects and determines the two basic factors that make the products competitive in the market, quality and price New technology also affects the state

of the art facilities for businesses through the transfer of technology and the process of collecting, processing storage and transmission of economic information Assembly

1.5.2.1 Sectoral Environmental Analysis:

An industry is a group of companies that provide products or services that can

be closely intertwined In competition, companies in the industry are influential Generally, each sector consists of a mixture and variety of competitive strategies that companies pursue to try to achieve a higher than average income

Industry analysis and competition to shed light on key issues:

- The economic characteristics of the sector

Competitive forces are active in the industry, the nature and power of each force

- Motivations for change in the industry and their impact

- Companies with the strongest and weakest position

- Who would be the one who made the next move in the industry?

- Key factors for success in competition

- The attractiveness of the sector in terms of profitability above average

Managers can not form a long-term orientation, or a strategic decision, if they

do not have a keen understanding of the company's strategic situation, the nature and the competitive conditions that it does to face, how to create a fit between resources and capabilities with those conditions

Figure 1.2 The force model of M.Porter

The author approaches the competitive model of M Porter, which includes 5 competitive forces that help strategists in the analysis of the sectoral environment The task of the strategists is to analyze and judge Competitive forces in the industry

to identify opportunities and threats to their businesses

● Competitors:

Alternative servic

e products

Pressure of the supplier

Potential opponents

Competitors in the industry

Pressure of the buyer

The first of the five forces of the M.Porter model is the size of competition among the existing firms of a manufacturing sector If the weaker the competition, enterprises have the opportunity to increase sales prices and make more profits On the contrary, when competitors are strong, price competition is significant, and price competition leads to vulnerability Competitors are companies that are working in the same industry as the business, and they are looking to increase sales, increase profits through policies and measures that create disadvantages for businesses Because of the limited market size, businesses compete for market share by reducing prices, advertising, promoting, persuading customers, improving quality of products and services, creating prices for customers

● Customers:

Buyers can be seen as a competitive threat when forcing a business down or demanding higher quality and better service Conversely, when weak buyers will give the business the opportunity to increase prices earn more profits Buyers include: final consumers, distributors (wholesalers, retailers) and industrial buyers Customer pressure is usually expressed in the following cases:

When buyers are small and large, suppliers are small and medium in the supply chain

Customers buy a large volume

The supply chain depends on the customer with a large percentage of the total order

Customers can use vertical link strategy

Customers have the information about the market as the demand, prices of the suppliers, the bargaining pressure of them is greater

● Supplier:

The third force in competitive forces is the bargaining power of the supplier Suppliers can be considered as a threatening pressure when they are able to increase their selling prices or reduce the quality of the products or services they provide This reduces the profitability of the business Suppliers' pressure is usually expressed in the following situations: When the supplier is an exclusive supplier,

the situation does not have a substitute product; The enterprise is not the preferred customer of the supplier; The type of input provided by the supplier is important to the business; A strategic alliance or competition in the supply or supply chain is a solution to reduce the pressure of this environmental factor

● Potential competitors:

Potential competitors are current businesses that are not competing in the same industry; But they are competitive if they choose and decide to join the industry This is a threat to existing businesses Existing businesses try to prevent potential competitors from entering the industry because more and more businesses are in the industry, the competition is fiercer, the market and profits are shared the position of the business will be changed

● Replacement:

The last force in M.Porter's model is the threat of alternative products Replacement products are other products that can satisfy the same needs of the consumer Its basic characteristics often have advantages over the product being replaced in its own distinctive features The appearance of alternatives is varied and complex, creating a very competitive price risk for the old product, reducing the profitability of the business To limit the impact of this risk, businesses must also invest properly in R & D

1.5.2.2 Analysis of internal environment of enterprises:

A thorough analysis of the internal factors of enterprises to clearly identify the advantages and disadvantages of enterprises When doing this, the bottom line is how to identify areas of concern, which issues need to be investigated and what criteria to evaluate it well or not so well that it can receive In this segment of the strong business, in the other business sector weak The author approaches quantitative and qualitative methods based on the following evaluation models

From there, measures are taken to reduce the disadvantages and promote the advantages to achieve the maximum advantage Thus, the manager will be better aware of internal circumstances by analyzing the following key factors:

• Elements of human resources:

Human resources play a very important role in the success of the business

As humans gather data, plan the target, select and test the strategies of the business, and to achieve good results, there is no shortage of effective people When analyzing the human resources of the enterprise, attention should be paid to: the professional qualifications, experience, skills and ethics of the staff; the personnel policies of the enterprise; the ability to balance the level of labor use at the maximum and minimum levels; capacity, level of interest and level of top management

Figure 1.3 Model of choice of factors affecting business performance

• Development factors:

Research and development efforts can help businesses play a leading role in the industry or vice versa, leaving companies lagging behind industry leaders Therefore, enterprises must constantly change in terms of technological innovation related to technology, products and raw materials

• Factors of production:

Prelimin ary analysis

Mode ling and evalu ating points

Carry out the calculati

on and importan

ce of each factor to the producti

on and business activities

of the company

Select the most influential factors to the results

of productio

n and business activities

Consider the actual

Manufacturing is one of the major activities of the company associated with the creation of products, strongly influencing the success of the business The production of relatively high quality products with relatively low prices will bring many benefits for businesses Particular attention should be paid to the analysis of the factors of production: price and level of supply of raw materials, inventory turnover, layout of production facilities, efficiency and cost of production cost, and technological capabilities over the industry and its competitors

• Financial and accounting factors:

The functions of the finance department include the analysis, planning, and monitoring of the financial performance and financial performance of the firm, which has a profound impact throughout the enterprise When analyzing financial and accounting factors, managers should focus on the following contents: Capability to mobilize short-term and long-term capital; Total capital of enterprises; Flexibility of capital structure; ability to make use of financial strategies; The ability

to control cost reduction; The accounting system is effective and serves for cost planning, financial planning and profitability

• Marketing Factor:

The functions of the marketing department include the analysis, planning, implementation and monitoring of the implementation of the proposed programs, the maintenance of relationships and exchanges with clients on the principle of mutual benefit profit Thus, in general, the task of marketing management is to adjust the level, time and nature of demand between customers and businesses to achieve the goal

• Information Technology Factor:

When evaluating information systems, we will consider aspects such as the level of application of information systems in management and production activities; update, volume, abundance of information; the accuracy of information sources and the security of the system From here we will get the assessment, integrated in the model of internal environment assessment of enterprises

1.6 Tool to provide information for strategy development:

1.6.1 Internal Factor Matrix (IFE):

This matrix summarizes and evaluates the important strengths and weaknesses of the functional business divisions, and it also provides the basis for identifying and evaluating the relationship between these divisions The IFE matrix

Step 4: Multiply the importance of each factor to its classification (by step 2

x step 3) to determine the score of importance

Step 5: Add the total score on the importance for each factor to determine the score of importance

Regardless of how many factors the IFE matrix has, the maximum number of points a business can receive is 4.0, the lowest is 1.0 and the average is 2.5 A score greater than 2.5 indicates that the firm is strong in points and vice versa if less than 2.5

1.6.2 External Factor Matrix (EFE):

The External Factor Matrix (EFE) helps us summarize and quantify the effects of

environments on the business The development of an EFE matrix consists of 5 steps:

Step 1: List the factors that are critical to the success of the business as

identified in the macroeconomic assessment process

Step 2: Sort the importance from 0.0 (unimportant) to 1.0 (very important) for

Step 4: Multiply the importance of each factor to its classification (by step 2

times step 3) to determine the score of importance

Step 5: Add the total score of importance for each factor to determine the

total number of critical points of the business

Regardless of the number of opportunities and threats in the matrix, the maximum number of critical points a business can have is 4.0, the lowest is 1.0 and the average is 2.5 A score of more than 2.5 points indicates that businesses take advantage of the opportunities and limit the environmental threats at above average

levels

1.6.3 Competitive Image Matrix:

The competitive image matrix identifies the main competitors with their strengths and weaknesses This matrix is an extension of the matrix that evaluates external factors and internal factors that are critical to the success of the business In addition, in the competitive image matrix, competitors are also considered and counted the total number of important points The total number of points evaluated

by competitors is compared to the business being studied The comparison provides

us with important strategic information The way to build competitive image

matrices is similar to the way matrix formulation evaluates external factors

1.7 Strategy development and selection:

To select, arrange and combine internal and external factors to work out possible strategies for organizations and authors to apply the combination of 5

matrix tools, including: SWOT matrix, SPACE, BCG matrix, QSPM matrix

1.7.1 Matrix strengths - weaknesses, opportunities - risk (SWOT):

SWOT analysis is one of the two fundamental analytical techniques to determine the strategic direction of development and determine the strategic position of the business that is most commonly used in strategic management today

SWOT matrix is a tool that combines strengths (S), weakness (W), opportunity (O) and challenge (T) to form four types of strategies:

- SO Strategy: Use internal strengths to exploit the opportunities of the external environment

- WO Strategy: Take advantage of outside opportunities to improve internal weaknesses These weaknesses prevent businesses from exploiting opportunities, so businesses need to overcome weaknesses as quickly as possible

- ST strategy: Use the strengths of the business to avoid or reduce threats from the external environment

- WT Strategies: These are defensive strategies that reduce internal weaknesses and avoid external threats

The purpose of the SWOT matrix is to work out feasible strategies, not to decide which strategy is best Therefore, among the strategies developed in the SWOT matrix, only a few strategies are chosen

Figure 1.4 Schematic diagram of SWOT

1.7.2 Strategic planning matrices can be selected

1.7.2.1 BCG Matrix

The enterprise's BCG matrices on the overall products and services in order to determine the market share of enterprises in relation to the overall market growth of products and services, thus determining the position of products and services of enterprises to contribute to make decisions such as investment restrictions, promote investment, withdraw from the market

Figure 1.5 BCG matrix

Dog: its products and services are in a bad state, the market share is low, the growth rate of the market for products and services that businesses have business growth is low In this position decide wisely in the conditions do not overcome the weakness of the business, or enterprises also have no strengths often withdraw from the market

Cow: Products and services of enterprises are occupying high market share

in a market with low growth rate, enterprises can continue to business but must continue to maintain and promote strengths

Question mark: Service products of enterprises have low market share in a market with high growth Businesses need to overcome weaknesses, create strengths to increase market share

Star: Products and services of enterprises are occupying market share in a growing market, businesses need to promote investment to increase business efficiency

1.7.2.2 SPACE Matrix:

Space Matrix is a powerful tool to identify the determinants of an organization's strategic location These factors include: financial strength of the organization (FS); Competitive advantage of the organization (CA); Stability of the business environment (ES); Industry attractiveness (IS)

The process of building a Space Matrix consists of the following steps:

Select variables that represent FS, CA, ES, IS

Determine the value of the variables FS, CA according to principle 1 is the worst, 6 is the best

Determine the value of the variables ES, IS according to principle 1 is the best, 6 is the worst

Calculate the average scores for FS, CA, ES, IS

Add points on the horizontal axis and mark the result, add points on the vertical axis and mark the result Draw the vector directionally from the origin to these points

Outcome is offensive, defensive, competitive, prudent

+ Attack strategy: take advantage of strengths and opportunities, overcome weaknesses and challenges, maximize resources to promote growth

+ Defense strategy: focus resources and specialization to overcome weaknesses, limiting the impact of the challenge

+ Competitive Strategy: To promote the growth of products and services to penetrate the market

Prudential strategy: Growth is explored, concentrated resources are sufficient

to maintain appropriate growth

1.7.2.3 QSPM matrix

The SWOT matrix provides selectable strategies and the QSPM matrix is a tool to determine which strategies are best for the business The QSPM matrix uses inputs from the analysis of EFE and IFE matrices and the combined results of the SWOT matrix analyzes to determine the objective of the best alternative strategies

To develop the QSPM matrix, there are 6 steps as follows:

Step 1: List the external opportunities and threats and weaknesses within the business

Step 2: Categorize each key success factor inside and outside This classification is in the IFE and EFE matrix

Step 3: Identify alternative strategies that businesses should consider implementing Bring strategies into separate groups if possible

Step 4: Determine the gravitational pull of each strategy (AS) Attractive points represent the relative gravity of each strategy relative to other strategies Only new team strategies compare Points of interest are divided as follows: 1 is not attractive, 2 is slightly attractive, 3 is quite attractive, 4 is very attractive If the success factor does not affect the strategic choice, do not grasp the strategies in this strategic group

Step 5: Calculate the total number of points of interest (TAS), which is the result of multiplying the number of grading points (step 2) by the number of gravitational points in each row

Step 6: Calculate the total points for each strategy This is the sum of the total points of interest in the strategic column, the higher the score, the more attractive the strategy is

In summary, businesses in the business process must always identify their annual goals and long-term goals The business strategy is the path and steps on the way to achieving those goals

in order to clarify the theoretical and practical issues of business strategy development for Joint Stock Commercial Bank for Investment and Development of Viet Nam - Tu Liem Branch in the phase of 2017-2021 The Bank's regulations and operating principles as the basis for the scientific review, survey and proposal of

business strategy solutions in the next chapters

CHAPTER 2 CASE ANALYSIS OF JOINT STOCK COMMERCIAL BANK FOR INVESTMENT AND DEVELOPMENT OF VIET NAM – TU LIEM

BRANCH 2.1 Overview of the Joint Stock Commercial Bank for Investment and Development of Viet Nam

Established under the name of Vietnam Construction Bank under the Ministry of Finance, after 60 years of operation, BIDV has become a joint stock commercial bank with the largest scale in Vietnam As of 31/12/2016, BIDV has total assets of over VND 1 trillion (equivalent to nearly USD 50 billion), leading commercial banks in Vietnam, top

30 ASEAN and top 500 global BIDV's current organizational structure includes: 01 head office, 190 domestic branches and 01 foreign branch in Myanmar; 815 transaction offices;

02 subordinate units; 03 representative offices in Vietnam; 06 representative offices in foreign countries: Cambodia, Myanmar, Laos, Czech Republic, Taiwan, the Russian Federation; 07 subsidiaries

Domestic network spreading across the provinces helps BIDV to reach a large number of customers nationwide and surrounding areas, providing diverse services to a wide range of customers from individuals, Households to various types

of organizations and enterprises BIDV is aiming at a multi-owned and diversified banking and finance group, operating and administering in accordance with international practices and standards, improving efficiency in all four pillars, namely Banking, Insurance high quality, professional investment in the financial market of Vietnam and the world

2.2 About Joint Stock Commercial Bank for Investment and Development of Viet Nam - Tu Liem Branch:

2.2.1 Formation and development process:

Joint stock commercial Bank for Investment and Development of Viet Nam

- Tu Liem Branch was officially established and came into operation on 01/06/2015

The organizational structure of the branch is composed of 5 blocks: Customer Management Division: Corporate Clients Division, Personal Banking Division - Risk Management Division: Risk Management Division; Business Unit: Credit Management Department; Customer Transactions; Internal Management Division: Internal Management Division;

The current organizational model is as follows:

Figure 2.1 Organizational model of BIDV Tu Liem

2.2.2 Business activities of Tu Liem Branch:

In the general context of the economy, the banking system and the BIDV system, Tu Liem Branch has closely followed BIDV's guideline and direction to actively and flexibly carry out business activities According to updated data, up to 30/6/2017, the results of the implementation of specific activities as follows:

Table 2.1 Update of business results of BIDV Tu Liem 30/06/2017

1 Net service income 5.37 17.50 31% 7 77%

2016, fulfilling 100% of the second quarter loan plan

Operating norms exceeded the plan, and DVR revenue only reached 77% due to the decline of guarantee fees from the beginning of the year Only in June, TNR from card activities has achieved the level of 103%, income from M & E

made 97% of the whole 2016

Revenue difference reached 25.4 billion Profit before tax was VND16.73 billion, fulfilling 112% of the plan for Quarter II For profit results, the branch is

ranked 27/34 in the cluster, and 141/190 across the system

2.2.3 Products and services:

BIDV Tu Liem is trying its best to diversify its banking products and services, not only in the traditional operations of receiving deposits and loans but also launching many banking products and services modern The main products

and services can be divided into 3 groups:

Group 1: Debt operations such as payment deposits, demand deposits, term

deposits, ATM deposits, bank deposits

Group 2: Asset properties such as loan, guarantee, export document discount,

foreign currency trading, currency trading

Group 3: Banking services such as financial services package for universities, businesses, payment, import, ATM card services, Phone banking,

Home banking, BSMS, IBMB

Debt asset operations help to create capital for the Bank Assets and services are business products that bring revenue to the Bank In particular, interest income from

loans accounted for the largest proportion in the income structure of BIDV Tu Liem

2.2.4 Analysis of business activities of BIDV Tu Liem in 2016:

In order to have a full view of business results, the author assesses the business results of BIDV Tu Liem by year, with focus on 2016 as the basis for analyzing the strategy

Table 2.2 Evaluation of business results of BIDV Tu Liem 31/12/2016

Unit: billion dong, %

% HTKH

So với 2015 STĐ %TT

I Main Targets

2 Income from Card

(ii) Mobilization of capital at the end of the period reached 3,200 billion VND, completing 107% of the 2016 plan, compared with 31/12/2015, raising capital by more than 1,400 billion VND, growing 82% In the structure of capital, mobilizing retail capital still accounts for the largest share (70% of total capital mobilized from the branch)

(iii) Credit outstanding at the end of the period reached VND 1,350 billion, fulfilling 96% of the plan, increasing VND 439 billion compared to 2015 Retail loans excluding pledge reached VND 305 billion, completing 87.1% of the plan

Account NPLs for 0.08%, cao cấp về kế hoạch 0.01% Group 2 debt ratio is 0.02%, được cấp phát về kế hoạch chính

(iv) Most of the business plan and branch completion exceeded the assigned plan, specifically:

+ Net service income was estimated at VND13 billion, completing 109% of the plan, up VND10.1 billion compared to the end of 2015 Of which, net revenue from card services was estimated at VND1.5 billion, completing 150% of the plan

+ Revenue from business and revenue is estimated at 1.9 billion, completed 190% of plan delivered

+ Net income from retail trade and premium insurance is estimated to be 100% of the plan

*) Some positive points in the governance:

BIDV Tu Liem has actively researched, created and applied innovative management methods in business activities, specifically as follows:

- In terms of thin staff, BIDV Tu Liem has grown sales channels through collaborators Established a Business Development Team with a vision to act as a Virtual Customer Unit (CTV) in order to grow its individual, corporate and service-oriented client base Customer care of the branch Up to now, BIDV's activities have significantly contributed to the retail operation of BIDV Tu Liem

- Carrying out and evaluating monthly KPIs with additional bonuses for Board members and Board members has created a fairly accurate measure of the effort and performance of individuals, The unit then creates the motivation to complete the task

- To implement the mechanism of piloting package expenditures for transaction offices and customer relations in order to create an active mechanism for direct units in the branch

- Implementing many motivational programs directly linked to the 2016 business focus with the profit bonus directly attached to financial supports, TDs, retail services one of the outstanding programs is "Competitive business competition attracts athletes," has just increased the customer base

- Focusing on branding, image enhancement, BIDV brand recognition in the customer's heart, specifically, the branch has improved the transaction office space and moved the transaction office BIDV brand identity regulation

- Focus on the training of customer relations officers: The branch regularly organizes training sessions, hone skills, experience, customer interaction style, friendly, polite, for all customer relations staff, ensuring the quality of service of the branch with customers

*) Shortcomings:

- Mobilizing capital despite good growth rate and exceeding the assigned plan However, the capital of BIDV Tu Liem depends on some big customers, especially retailers In the face of adverse changes in interest rates, the risk of falling capital from large clients is very high In addition, non-term loans of BIDV

Tu Liem accounted for a small proportion, resulting in lower NIM than some newly

established branches and in the cluster

- The growth of credit debt was difficult, especially in the extremely competitive conditions with some commercial banks in the area BIDV Tu Liem has actively sought and exploited a number of potential businesses However, due to the failure to meet certain loan conditions as well as the assessment that there are still

many risks, borrow

- Net service income exceeded the assigned plan, but the results of DVR

collection also depend on some key services such as guarantee and shopping center

- The branch has not formulated a clear and well-defined business strategy as the basis for developing solutions and action plans to maximize resources to achieve

development of business strategies In the above period, some main developments are as follows:

- Inflation is controlled, macroeconomic fundamentals are stable Consumer price index will decrease from 18.13% in 2011 to 0.6% in 2015; interest rates fell about 50% compared to the end of 2011; credit outstanding increased, credit quality gradually improved Exchange rate, foreign exchange market stable; Overcoming the basic use of dollars and gold in payment; confidence in the Vietnamese currency increased

- The major balances of the underlying economy are guaranteed Export turnover increased quite high, reaching an average of 17.5% per year Trade balance improved; international balance of payment surplus; Foreign currency reserve reached the highest level ever Public debt within the prescribed limits Total social investment capital was 1.8 times higher than five years ago, reaching an average of 31.7% of GDP; FDI increased 35.6%, disbursed ODA increased 61% Strengthening market management, price, ensuring balance of supply and demand of essential goods and promoting the prevention of smuggling and trade frauds

- Economic growth is maintained at a reasonable level, from gradually recovering in 2013, higher than in the previous year Five-year average GDP growth was 5.91% The scale and potential of the economy continue to increase; GDP in 2015 reached $ 193.4 billion, per capita $ 2,109 Industrial sector, construction recovered and higher growth in the last years, an average increase of 6.9% per year The agricultural sector has been growing steadily, rising 3% a year on average The service sector grew

at an average rate of 6.3% per year

- Restructuring the economy in line with the reform of the growth model has achieved initial results To actively implement the Scheme on the overall restructuring

of the economy and schemes on restructuring the branches and domains

- The Government focuses on dealing with bad debts and restructure credit institutions, especially weak joint stock banks; To enhance the supervision, inspection, inspection and assurance of the system safety Step by step applying international management standards Promoting the role of the Asset Management Company of Credit Institutions (VAMC)

- To step up the restructuring, concentrate on equitization, divest investment outside the sector and raise the efficiency of State enterprises; has arranged 558 enterprises, of which equitization 478, reaching 93% of the plan

*) Vietnam economic situation in 2016:

- The world economy in 2016 is lower than expected, the domestic economy

is facing many difficulties when being affected by natural disasters, environmental incidents, public debt increases .; In this context, the Government and other ministries, sectors and localities have strongly implemented policies and guidelines

to help solve difficulties for enterprises, improve the investment environment, improve competitiveness Macro economic recovery, "overcome success": GDP reached 6.21%; inflation controls 4.74%; total export turnover reached USD 175.9 billion, up 8.6%, trade balance surplus 2.52 billion USD; Total realized FDI reached

$ 15.8 billion

Besides the advantages, we have faced many difficulties and challenges Economic growth, global trade is lower than forecast; The prices of many basic commodities and crude oil prices are low The situation in the South China Sea is complex Climate change is faster than forecast

* Some of the Government's economic development options related banking sector: World situation in 2017 is forecasted to continue complicated; The world economy could rise higher than 2016 but still recover slowly, unevenly and still have many risks Prices of some basic commodities and crude oil remain low Strategic competition between major countries in the region is fierce The situation

in the South China Sea continues to be stressful and unpredictable In the country, besides the advantages, we still have many limitations, weaknesses Productivity, quality, efficiency, competitiveness are low while the world is entering the Fourth Industrial Revolution In this context, the Government has selected a number of objectives:

- To ensure the macroeconomic stability, making clear changes in the implementation of three strategic breakthroughs, restructure the economy in

combination with reforming the growth model, raising productivity, quality, efficiency and capacity compete, encourage start-ups, grow businesses, promote growth

- Implement tight fiscal policy, tighten fiscal discipline - State budget Focus on preventing losses, transfer pricing, expanding tax base, reduce tax arrears Thoroughly save money; Linking the arrangement of projects and tasks with the ability to balance resources Strongly attract non-state investment, including the FDI sector to develop infrastructure; To perfect the mechanism of management, supervision and charge collection policy, ensuring publicity and transparency To develop stable and improve the efficiency of securities, bond and real estate markets

- Focus on removing difficulties, improving the business investment environment, promoting growth Continue to perfect mechanisms, policies and laws

on planning, investment and business

- Continue to improve the legal framework, especially the handling of mortgaged assets, promote the development of debt trading market, fully identify and deal with more bad debts and commercial banks weak trade; reduce the cross-ownership status in credit institutions, ensure system safety Encourage the mobilization of capital through the stock market, renewing the mode and improving the quality of market surveillance; merged two transaction centers and improved the quality of securities services Implement the master plan for restructuring SOEs in 2016-2020 Promote equitization, capital withdrawal according to the market mechanism To set up specialized agencies to represent the owner of state capital at enterprises

2.3.1.1 Social and Cultural Environment:

• Population size and population structure:

Vietnam population in 2016: 93,421,835 people The rate of male / female is 100% but this rate is not uniform in all age groups, especially notably the situation

of male children more than girls The smaller the age group, the higher the sex ratio, with the highest age group between 0-4 and the highest sex ratio of 111.6% or 111 per 100 girls , 6 boys