Solutions for lack of marketing activities of viet phat uniform limited company

From the above symptoms, it is considered that Viet Phat is facing somepotential problems, such as high price and poor product’s quality, lack of marketingactivities and poor training fo

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-Le Ngoc Hai Trieu

SOLUTIONS FOR LACK OF

MARKETING ACTIVITIES OF VIET

PHAT UNIFORM LIMITED

COMPANY

MASTER OF BUSINESS ADMINISTRATION

Ho Chi Minh City – 2019

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-Le Ngoc Hai Trieu

SOLUTIONS FOR LACK OF

MARKETING ACTIVITIES OF VIET

PHAT UNIFORM LIMITED

COMPANY

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: DR LE THI THANH XUAN

Ho Chi Minh City - 2019

Table of Contents

1.1 The company overview 6

1.2 Problem context 7

CHAPTER II – PROBLEM IDENTIFICATION 1

0 2.1 Symptoms analysis 10

2.1.1 Limited customer network 10

2.1.2 Lack of brand awareness 10

2.1.3 Ineffective digital marketing 12

2.2 Problem analysis 14

2.2.1 Potential problems 14

2.2.2 Main problem validation 17

2.2.3 Problems – Symptoms Map 21

CHAPTER III – CAUSE ANALYSIS 2

2 3.1 Potential causes 22

3.1.1 Lack of attention from the board of directors (B.O.D) 22

3.1.2. Lack of resources 22

3.1.3 Wrong personnel 24

3.2 Initial Cause-Effect Map .25

3.3 Main cause validation 25

3.3.1 Lack of B.O.D’s attention 25

3.3.2 Wrong personnel 28

3.3.3 Lack of resources 30

3.4 Final Cause-Effect Diagram .32

CHAPTER IV – ALTERNATIVE SOLUTIONS AND ACTION PLAN 3

4 4.1 Alternative solutions 34

4.1.1 Establishing a marketing department 34

4.1.2 Investing more capital budget to conduct marketing activities 36

4.1.3 Hiring employees to support marketing activities 38

4.2 Action plan 39

CHAPTER VI – SUPPORTING MATERIALS 4

5 References 6

2

2 | P a g e

List of tables

Table 2.1. 10

Table 3.1. 26

Table 3.2. 27

Table 4.1. 41

List of figures

Figure 1.1 6

Figure 1.2 8

Figure 2.1. 12

Figure 2.2. 13

Figure 2.3. 13

Figure 2.4. 21

Figure 3.1. 25

Figure 3.2. 32

Figure 3.3. 33

Figure 4.1. 34

Figure 4.2. 40

Executive summary

Nowadays, as the world has developed continuously, the living standard hasbeen improved rapidly In order to meet those standards, more and more businesseshave been established Specifically, in the garment industry, there are many firms thatare able to providing uniforms for both schools and businesses However, there is just

a few companies meet the required standards of customers Therefore, Viet PhatUniform Limited Company has been established to offer high quality uniform withreasonable price

As a new and small business, Viet Phat Uniform Limited Company has many weakaspects that need improvements, especially the marketing field Firstly, it is realized that ithas limited customer network, lack of brand awareness from the customer, and ineffectivedigital marketing From the above symptoms, it is considered that Viet Phat is facing somepotential problems, such as high price and poor product’s quality, lack of marketingactivities and poor training for sales staffs Nevertheless, through analyzing andsynthesizing data and information, it is realized that the main problem that it has faced islack of marketing activities while its B.O.D just focus on expanding the customer networkbased on their relationships At the beginning, it is considered that because its B.O.D doesnot pay enough attention to the marketing aspect and they chose wrong personnel to coverthe marketing job that lead to its main problem However, based on the above analysis,data and arguments of its B.O.D, CEO, staffs, and other stakeholders, it is found that themain cause that leads to this problem is lack of resource Particularly, because of thedifficulties in the initial stage of a startup business, its B.O.D cannot provide sufficientresource including both human and financial resource to implement marketing activities.After many internal and external factors have been considered, it is suggested that VietPhat shoud recruit more employees to support its CEO who is simultaneously in charge ofthe marketing aspect in building an obvious marketing strategy and executing marketingactivities efficiently

CHAPTER I – INTRODUCTION 1.1 The company overview

In Vietnam, students have to wear uniforms when they go to school, especially

in primary and high schools Additionally, many businesses in Vietnam require theiremployees wear uniform when they go to work Although this is not a new market,there is a few businesses having reputation in providing uniforms having good qualityfor both schools and businesses Therefore, Viet Phat Uniform Company Limited wasestablished at the end of 2018 with the ambition of meet the needs of a great number ofcustomers, gain a big market share in the niche market, and build good reputation tobecome one of the most famous uniform brands in Vietnam Its organizational chart is

as below:

B.O.D CEO

Sales Accounting Department Department

3 staffs 1 staff

Figure 1.1 The organizational chart of Viet Phat

Its board of directors (B.O.D) consists of 2 persons, they are responsible for investingmoney to the company when it needs, making important decisions and also buildingthe business strategies The company has a Chief Executive Officer (CEO) withresponsibilities of managing all activities of the company, cooperating with BOD tomake business strategies, communicating with departments to deliver tasks to them aswell as it is suitable for its strategies and directions, and work with manufacturers As

Viet Phat has just been established for a few months, CEO has to work in many roles tosave costs, especially in marketing aspect She is responsible for developing business’sgoodwill, conducting marketing activities, such as advertisements on media channels,marketing campaigns, etc., and suggesting ideas to let customers know about Viet Phatand its products It also has an accountant to do accounting tasks as the company does nothave too much accounting activities to do in this initial stage There are 3 sales staffs insales department to approach potential customers in order to boost sales revenue up andwiden customer network They have to find customers, meet them, and introduce itsproducts and benefits that customers can get if they cooperate with Viet Phat.

Viet Phat is a startup business which offers uniforms for not only schools but alsobusinesses In order to gain more market share, Viet Phat offers customers higher discountrate than its rivals Particularly, it offers 30% discount rate for customers when rivals offerapproximately 25% It competes with other rivals by discount rate in not only the initialstage but also later Additionally, Viet Phat always tries to provide customers productshaving high quality material and beautiful seam but with competitive price Because VietPhat is a new comer in the market, its target customer concentrates on schools in Vietnam

in initial stage As those schools have new students every year, they have to orderuniforms for both new and current students It will bring Viet Phat stable order and incomeeach year However, Viet Phat still serves businesses that have demand in order uniforms

to develop the customer network However, it will be focused more after the company hascertain market share and goodwill in Vietnamese market The mission statement of VietPhat is providing uniforms with high quality material with the competitive price Viet Phatdoes not manufacture clothes, it is the intermediary between the manufacturer andcustomers It finds customers, deals with them, receives orders, and brings them for themanufacturer Then, it gives finished products for customers To assure that Viet Phat canprovide high quality material uniform, it has to deal with manufacturer to get theagreement of using chosen material If there is any mistake of finished products, Viet Phathas responsibility to work with the manufacturer to fix them and give customers productshaving high quality

1.2 Problem context

Vietnam’s garment sector has had speedy and sustainable development over thelast few years which have played a crucial role in the country’s socio-economicdevelopment, especially there are approximately 6000 textile and garmentmanufacturing firms operating in Vietnam (1) However, almost garment manufactures

in Vietnam produce clothing majorly for export, not focusing on local consumptionmarket Vietnam held the 4th position in the top 10 global garment exporters in 2016.For example, Viet Tien, Nha Be, Garco 10 are familiar brands in garment industry inVietnam that concentrate on exporting clothing

Figure 1.2 World Ranking Among the Top Garment Exporting Countries in 2016

(WTO Reports World Textile and Apparel Trade in 2017)

Because almost big and famous garment brands focus on export market, domesticmarket is a “promising land” for small businesses, especially in niche market likesupplying uniforms Obviously, for the Vietnamese garment market, the demand has beengrowing thanks to the higher income and higher living standard of Vietnamese There aremany opportunities for domestic garment brands if they accept the challenges

and have a strategy to reach the market As Viet Phat is a new business in Vietnamesemarket, it has many weak aspects that need to be improved and developed.Particularly, the most important aspect that needs to be developed is the marketingstrategy Marketing refers to a process in which a product or service is introduced andpromoted to any potential customers Since it was established, Viet Phat has justdepended on the relationship of its owners to develop the customer network Thus, ithas not had marketing strategy yet to build the image, brand position, and reputationalthough it is very essential in developing business in fierce competitive market.Customers should have known about its brand name, reputation, and also the image, so

it can gain more market share and widen its customer network Nowadays, there aremany competitors in the market that already has had reputation and trust fromcustomers Rivals can provide products that are not as well as Viet Phat, but theycommunicate their value for customers better, so they gain trust from customers.Hence, more customers prefer to incorporate with them to Viet Phat They haveeffective marketing strategies to communicate to their customers, such as advertising

on social media channels, having their own website, brochures, do some marketingcampaigns and so on Therefore, if Viet Phat has not had marketing strategy, it canoffer the best products in its niche market, however, no one can even hear of it

CHAPTER II – PROBLEM IDENTIFICATION 2.1 Symptoms analysis

2.1.1 Limited customer network

Every business would like to widen its customer network as broadly as possible,Viet Phat also wants the same thing Nonetheless, it reaches current customersdepending on the owners’ relationships Specifically, Viet Phat’s owner has goodrelationships with those customers, then he convinced them to cooperate with VietPhat In particular, Viet Phat has about only 6 current customers depending on theowners’ relationship, and they are only schools not businesses It has not had anymarketing strategies to enlarge its own customer network Though it is good toapproach certain customers initially, it cannot be considered as a long-term strategy ifViet Phat has a chance to develop more and more in the market

CUSTOMER LIST

Table 2.1 Viet Phat’s customers list

2.1.2 Lack of brand awareness

As Viet Phat does not have any marketing activities, customers do not know anythingabout them It cannot reach its target customer because its products and services have notbeen introduced to them They do not apprehend factors that products can offer for them.Therefore, it loses a great number of customers as they do not know the benefits whenthey do business with it In particular, a survey was conducted by interviewing somepeople about their awareness of some Vietnamese uniform brands, all of people who areinterviewed that whether or not they knew anything about Viet Phat said that

they had never heard anything about Viet Phat They do not know that what services orproducts Viet Phat can offer to them and benefits when they choose its products Forexample, a respondent stated that she thought about Saigon Uniform, Dony Uniformwhen she was asked about the famous and popular uniform brands in Vietnam, and shedid not have any idea about Viet Phat She shared:

“My company requires all employees wearing uniforms from Monday to Thursday, and we are allowed wearing “free styles” on Friday I see that uniforms we received from the company having tag of Dony uniform and Saigon uniform Then I asked some

of my friends about those brands, they told me that they were very popular in the uniform market.” (Ms Vy Vo, 29 years old, an employee of a logistics company)

Then she was asked that how she had known those brands, and she replied:

“My company choose those companies as a partner to provide uniforms for us Moreover, I had saw their advertisements on social media channel like Youtube and Facebook, they were very interesting Then I search them on Internet, there is lots of information on their own websites that helped me a lot to understand more about them.” (Ms Vy Vo, 29 years old, an employe of a logistics company)

Even though sales staffs find new customers and introduce them Viet Phat’sproducts, the amount of customers they can reach is very small to make customershave brand awareness about Viet Phat and build goodwill in the market Particularly, asales staff calls, emails, and meets approximately 15 to 20 people, not all of themhowever answer the phone or take time to listen to sales staff, read emails, and meethim or her Therefore, brand awareness affects significantly to the performance of salesstaffs A sales staff shared that because customers do not apprehend anything aboutViet Phat, it is very difficult for them to convince customers listen to them or meetthem Hence, sometimes they feel discouraged and they did not want to do their jobanymore Some sales staffs stated:

“I had put all of my effort to convince customers cooperate with Viet Phat but they said that they did not know anything about Viet Phat, they were afraid that it would not offer high quality products for them.” (Mr Binh Vo, sales staff of Viet Phat)

“I had used knowledge and skills trained in the company to persuade customers, however, they rejected to deal with me as they have not ever heard anything about Viet Phat, they did not trust what I said.” (Ms Minh Le, sales staff of Viet Phat)

2.1.3 Ineffective digital marketing

Viet Phat has not invested in digital marketing yet Specifically, it has not had itsown website for customers to search it on Internet It is very difficult for customers tofind out and recognize it Because nowadays when people would like to do businesswith any company, they will search it on Internet first to know necessary informationabout it, then deciding to cooperate with it or not If a company does not have anyinformation on Internet, customers feel that it is not reliable to collaborate In addition,while rivals have their own website to provide information about them, Viet Phat doesnot have it, customers certainly choose to do business with its rivals Although it hasthe Facebook page, there is a few activities on this page to provide information aboutthe company, its services and products Furthermore, the content on posts on Facebookare not attractive enough to appeal more customers Hence, it gets low interaction fromcustomers and a few followers

Figure 2.1 The number of people approach posts on Facebook page

Figure 2.2 The number of followers on Facebook page

Figure 2.3 The interaction of people on Facebook page

Regarding with those pictures above, it can be said that the CEO does not care much indeveloping the Facebook page Also, in order to save money it does not have anyadvertisements on popular channels on Internet, so it cannot reach more potentialcustomers As the CEO has many tasks, she does not have enough time to do somemarketing activities carefully When the interview was conducted, she said that she

sometimes really wants to do some marketing activities for the company, but she has totake time for many other tasks.

2.2 Problem analysis

2.2.1 Potential problems

2.2.1.1 Lack of marketing activities

Marketing is considered as a heart of the business because most of activitieswork based on marketing In particular, selling products or services to customers is themost important thing of a business because it brings profit for the company to maintainand develop it According to all of above symptoms, it can be said that Viet Phat has anineffective marketing strategy Firstly, the owner of Viet Phat has not yet had anyactivities to approach more customers It develops customer network depending on therelationship of the owner Regarding with one of the owners of Viet Phat, he agreedthat Viet Phat depended too much on his relationship to reach customers:

“As one of the owners of Viet Phat, my responsibility is developing it by finding out way to approach more and more customers, giving direction to its development, and also managing it However, currently Viet Phat depends too much on my relationships

to reach customers It does not have any strategy to approach potential customers and introduce our products.” (Mr Quang Dang, one of the owners of Viet Phat)

Secondly, although it has introduced its products through sales staffs and onFacebook page, it seems to be not effective Particularly, there is no new customerscoming to Viet Phat because they see it on Facebook or they are introduced by salesstaffs It can be seen from the symptom of low interaction and followers on Facebookpage All of current customers come to the company via the owner of Viet Phat.According to an interview with the CEO of Viet Phat and she is also the one directly incharge of marketing activities in the company, she confirmed that the currentmarketing activities like Facebook page and through sales staffs do not bring any goodresult for the company:

“Although we still have some marketing activities like posting pictures and information

on Facebook page and let the sales staffs introduce products directly or via telephone

to customers, they do not bring any good consequences for Viet Phat Specifically, those marketing activities do not approach new customers, so there is no new customers working with Viet Phat because they see it on Facebook or they hear it from sales staffs.” (Ms Van Le, CEO of Viet Phat)

Next, lack of communication value to customers, especially providinginformation of what benefits exactly it can offer, is the vital factors in marketingstrategies that leading to ineffectively approach new customers Specifically, Viet Phatdoes not have any website or advertisements on other website to introduce its products

to customers

2.2.1.2 Higher price and poor products’ quality

Nowadays, the competition among many rivals in the industry through priceand quality is so fierce Every business would like to offer the product with goodquality but with competitive price Also, it is the thing that every customers want to beoffered Therefore, the question is whether the price that Viet Phat offers is higher thanits rivals but its products’ quality is not good enough, so it cannot have morecustomers Customers who received products from Viet Phat was asked that what theythought about the price and quality of Viet Phat’s products, then all of them stated thatthey were satisfied with products they had received, they are manufactured with highquality material, beautiful seam and competitive price:

“When I received uniforms from Viet Phat, I was really surprised and satisfied because those products had been manufactured carefully with good quality of material and competitive price even though Viet Phat is a new business in the market.” (Ms Quynh Truong, an employees in high school that in charge of controlling the quality of uniforms received from partners)

“We were very glad when we received Viet Phat’s uniforms as those products have met the needs of our school with beautiful seam, high quality material and competitive price comparing with our last uniform providers.” (Mr Phu Tran, vice president of a high school in Ho Chi Minh City)

Although schools and businesses are the one who sign the contract to incorporate withViet Phat, they are not the ultimate consumers using those products For example,regarding with schools, the ultimate consumers are students and the customers whopay for those products are students’ parents According to Ms Tuyen Nguyen, aprincipal of a high school in HCMC, she said:

“My school had a problem with uniforms inventories in the last year Particularly, as the quality of uniforms provided by the last uniform provider is not good, students’ parents decided to buy uniforms from other shops instead of the school, then they bought logo of the school and paste them on their uniforms Thus, there is a huge amount of uniform inventories from last year that has not been sold yet.” (Ms Tuyen Nguyen, a principal of a high school)

Therefore, as now customers has many choices in buying products, Viet Phat try its best tobring products with high quality for customers but not with high price Specifically,because all schools had uniform provider before, but now they choose Viet Phat as auniform supplier, Viet Phat try to keep the same price as the last providers offered but withthe same or better quality than them Hence, it can be said that Viet Phat has tried its best

to meet customers’ needs, so its products now can satisfy its customers

2.2.1.3 Poor training for sales staffs

Salespersons play an important role in doing business with customers becausethey are the one that directly meet, communicate and deal with customers Therefore,training for sales staffs is a necessary process that every business need to do, especiallyViet Phat as it is very new to customers Every sales employee coming to Viet Phat istrained for selling skills by Mr Tu Nguyen who is the one Viet Phat has incorporated

to train all sales staffs He has had experiences in sales aspect for 5 years as a salesmanager When he was asked about the performance of those staffs during trainingsession, he said that their performance was quite good, they paid attention for what hehad talked and try to remember them He said:

“I tried my best to transmit knowledge and skills I had learnt and experieced that are necessary for sales staffs When I trained them, I saw that all of them had paid their

attention too much to listen to me, write them down, and also tried to remember them when I asked them again about some topics.” (Mr Tu Nguyen, Viet Phat’s selling trainer)

Furthermore, when 3 sales staffs were asked about the reasons why customers usuallyrefuse to incorporate with Viet Phat, they listed many reasons, such as customerssigned a contract with other uniform providers before they come, they have not knownanything about Viet Phat so they did not trust what the sales staffs said, their uniforminventory in the last year had not been sold yet and so on

“I had put all of my effort to convince customers cooperate with Viet Phat but they said that they did not know anything about Viet Phat, they were afraid that it would not offer high quality products for them.” (Mr Binh Vo, sales staff of Viet Phat)

“I had used knowledge and skills trained in the company to persuade customers, however, they rejected to deal with me as they have not ever heard anything about Viet Phat, they did not trust what I said.” (Ms Minh Le, sales staff of Viet Phat)

“Some customers said that their orgnizations had had problems about uniforms inventory last year, their last providers manufactured products that did not meet their standards, so there were a huge amount of inventories that they need to solve Thus, they were afraid that a new business like Viet Phat would not offer the high quality products for them.” (Mr Nam Tran, sales staff of Viet Phat)

Although they try their best to persuade customers cooperating with Viet Phat by usingselling techniques that had been trained, customers still say “NO” with them.Therefore, it can be stated that the skills that had been trained of sales staffs is not thereasons that customers reject to deal with Viet Phat that leading to the limited customernetwork and lack of brand awareness

2.2.2 Main problem validation

“A successful product has to fulfill a specific need in the market”, particularly, itmust perform its functions, benefits, and also features (2) Viet Phat has done it so wellbecause it has manufactured high quality products that are recognized by customers Withthe mission of offering products with high quality materials, beautiful seam, and

competitive price, Viet Phat always tries its best to satisfied customers by both itsproducts and price As mentioned above, according to customers that had receivedproducts from Viet Phat, they were really satisfied with them They shared that:

“When I received uniforms from Viet Phat, I was really surprised and satisfied because those products had been manufactured carefully with good quality of material and competitive price even though Viet Phat is a new business in the market.” (Ms Quynh Truong, an employees in high school that in charge of controlling the quality of uniforms received from partners)

“We were very glad when we received Viet Phat’s uniforms as those products have met the needs of our school with beautiful seam, high quality material and competitive price comparing with our last uniform providers.” (Mr Phu Tran, vice president of a high school in Ho Chi Minh City)

Regarding with the price, as Viet Phat would like to keep the same price as itscompetitors but providing higher quality products for customers and also with higherdiscount rate, the uniform price is considered as a competitive price in the market.When being asked about the price of Viet Phat, some customers said:

“With the experiences of working with many uniform providers before, I think that the price Viet Phat offering for schools and organizations based on the price of last providers but with higher quality products was very suitable and competitive Customer can try its products with the same price as they had to pay before Then when they received Viet Phat’s products, they were very happy with them It seems to

be an excellent idea to develop Viet Phat and help it gain more market share.” (Mr Phu Tran, vice president of a high school in Ho Chi Minh City)

“In my point of view, offering the same price its competitors is a good idea for Viet Phat because the competitor’s price is very suitable and competitive for customers to agree dealing with them Therefore, if Viet Phat provides higher quality products with the same price as its competitors, it will satisfy customers’ needs As a customer of Viet Phat, I think that it offers customers not only good products but also good price.” (Ms Tram Nguyen, a principal of a high school in HCMC)

As Viet Phat is the new business in the market, it does not have enough figure to provethat the product and price is not a problem However, according to all of the interviewconducted to collect data, feedback, and comments from stakeholders, it can be statedthat the product and price of Viet Phat is not a problem that it is facing and needed to

be solved

Regarding with the training sales staffs, Viet Phat always tries its best to do it inthe best way as they can even though it is a new business that has not experiences andlots of money Because Viet Phat comprehends that the company will lose more time,money, and also effort when employees are not trained adequately to perform theirduties (3), its board of directors has paid their attention in training their employees Asmentioned above, Viet Phat cooperate with Mr Tu Nguyen to train for sales staafs He

is the one that has had many experiences and knowledge in sales aspect as experience sales manager Being asked that what they think about the selling trainerand what they had learnt from him, some sales employees stated:

5-year-“In my opinon, Mr Tu Nguyen is not only a professional trainer but also a experienced sales manager He has good expertise and knowledge in sales aspect that can teach us I had learnt many skills and knowledge from the case studies in reality that he had opportunities to experience in the past Some important skills for a sales staffs that I had learnt are selling skill, communication skill, persuading skill, dealing skill and so on I think they are very useful for my job.” (Mr Nam Tran, a sales staff)

“According to his performance, I think Mr Tu Nguyen is a a good sales manager that has a good background of sales knowledge and lots of experiences in this field His performnace was very impressive as he was so professional He used the real case studies to teach us essential skills in sales field, such as communication skill, problem solving skill, persuading skill and etc.” (Mr Binh Vo, a sales staff)

“After the training courses, I recognized that I had learnt many necessary skills and knowledge from Mr Tu Nguyen He attracted our attention by using practical case studies and also his sense of humour to release the stress in the training course However, it still gained good result because we could learn many things from him In the end of the date, we had an exam to test what we remember after training to remind

us about the knowledge that we had learnt I think it was a good method in training employees.” (Ms Minh Le, a sales staff)

As a new business,Viet Phat does not have enough figure to prove any problem Thus,synthesizing from aboved arguments, it can be stated that Viet Phat has done trainingcourse for employees very well As a result, it cannot be a problem that lead to limitedcustomer network and lack of brand awareness

Based on symptoms analysis and above arguments, lack of marketing strategy can

be considered as a main problem of Viet Phat Particularly, its customer network is limitedand customers even cannot regconize its brand because it had not had any marketingstrategy to communicate with customers Marketing plays an essential role because itrefers to all activities that associated with selling the company’s products or services (4) It

is very effective in communicate the business’ value proposition to its customers.Simultaneously, marketing is a useful way for customer education In order to decide tobuy or use a product or service, customers need to have solid understanding about theproduct or service, such as what it is and how it works with them (5) A marketing strategy

of a business refers to its marketing activities and decisions related to generating andsustaining competitive advantage of the business (6), concentrating on ways in which thebusiness can differentiate itself from its rivals by capitalizing on its distinctive strengths todeliver better value to its customers within a given environment

(7) Therefore, building a marketing strategy for a business refers to making a planincluding marketing activities in order to communicate the business’s value proposition tocustomers and distinguish itself among many competitors in the market As a result, if acompany does not have the marketing activities and strategy, it will not have any diretions

to align to develop its products and bring them to customers Furthermore, it makes everydecision made based on risky guesses It can waste the company’s resources, time, andmoney on efforts when the business’s owners have no idea about what they would do withtheir businesses Without the marketing activities, not only customers do not know aboutViet Phat as it does not have any methods to communicate to them but also it may putitself into risky situation Hence, it can be stated that lack of

marketing activities is the main problem that Viet Phat has to face with and needs to solve immediately if it would like to develop more and more in the future.

2.2.3 Problems – Symptoms Map

Figure 2.4 The Problems-Symptoms Map of Viet Phat

CHAPTER III – CAUSE ANALYSIS 3.1 Potential causes

3.1.1 Lack of attention from the board of directors (B.O.D)

Currently, the marketing strategy has not had a clear direction for Viet Phat toalign to do and all of marketing activities are not conducted effectively Therefore, thequestion is whether the B.O.D of Viet Phat does not pay enough attention for it Beingasked that if they concern about the development of the marketing strategy, one of theowner of Viet Phat replied:

“As Viet Phat is a new business, I really concern about the marketing strategy and also would like to marketing its products and brand to customers so as to more and more customers know about it Nonetheless, I would like to develop the customer network through my relationships in the initial stage to save costs Although our company has an employee responsible for marketing field, it has not brought any good result for the company.” (Mr Quang Dang, one of the owner of Viet Phat)

According to Mr Quang Dang, it can be said that the B.O.D of Viet Phat has paidattention to the marketing strategy to develop it, but it does not attract more attentionbecause it takes more costs Because its B.O.D concentrates too much on expandingthe customer network through the owners’ relationships, they had not build an obviousmarketing strategy yet They just do anything that they think it would impact Viet Phat

in the good way Specifically, being interviewed that if Viet Phat has any marketingstrategy and activities, the one that is in charge of marketing department shared:

“We do not have any long-term marketing strategy to develop Viet Phat Regarding with the short-term one, we just brainstorm about the ideas, think that it would be a good one, then we try to conduct it.” (Ms Van Le, CEO and the one in charge of marketing aspect of Viet Phat)

Therefore, it can be stated that its B.O.D had paid attention for marketing department

to promote its products and brand to customers, but it may not enough because of thedifficulties in the initial stage of a new business like Viet Phat

3.1.2 Lack of resources

As a new business, Viet Phat facing many obtacles of resources in the initialstage Particularly, it has limited capital because its has only 2 owners that investcapital for it and there is no outside investors It can be considered as its disadvantage

as it would not have adequate capital investment when it needs For example,regarding with marketing field, because of limited capital, Viet Phat cannot conductmore marketing activities to promote its products and brand and also build a marketingstrategy Building a marketing strategy needs a lot of money, time, and also humanresource, so the company that would like to do it should spend a great amount ofresources One of its owners said:

“I absolutely agree that we do not have a lot of money to invest in Viet Phat It is so risky that if Viet Phat needs a huge amount of capital immediately to run a project or a marketing campaign As it is in the initial stage, we try our best to use capital that we have to operate it However, whenever it comes to sustainable growth stage, we will consider to allow other investors join with us.” (Mr Quang Dang, one of the owner of Viet Phat)

In addition to capital, human resource plays a vital role in building an effectivemarketing strategy because they are the one that directly do those tasks Hence, hiringqualified employees contributes to the success of the company Nevertheless, as VietPhat is a new business, it cannot offer attractive salary and benefits for employees, sothat the qualified employees do not want to work for it Moreover, in order to savemore cots, its B.O.D decided that its CEO would be in charge of marketingdepartment It means that she has responsibilities to all activities of marketingdepartment CEO of Viet Phat stated:

“I would like to hire qualified employees for Viet Phat, but sometimes they do not really want to work for Viet Phat because it is a new business and it cannot offer very good salary and benefits Moreover, it is a small business and does not have the reputation, so the B.O.D decided that I would cover the marketing department to save more costs in the initial stage.” (Ms Van Le, CEO and marketing manager of Viet Phat)

As a result, she has to do everything in marketing aspect to develop business She cansuggest good marketing activities and strategy, however, it may not the best one for Viet

Phat because there is no one can help her She also conducts those activities, such asadvertising on Facebook, introducing products to customers through sales staffs and so

on Nonotheless, the way she did that may not the best way to bring good result for thecompany Thus, it is considered as an obstacle in building and developing marketingstrategy Furthermore, it takes time to build an effective marketing strategy BecauseViet Phat is a new business, it does not have enough time to make market research andbuild a marketing strategy

3.1.3 Wrong personnel

Because its marketing field is the responsibility of only one person and she maynot be excellent in this expertise, it can be considered as a cause leading to lack ofmarketing strategy Thus, the question is whether her expertise is good at marketingthat is able to build a marketing strategy and suggest good marketing activities todevelop Viet Phat The one has responsibility in marketing is Ms Van Le,simultaneously is a CEO of Viet Phat Regarding with her background, she is anMaster of Business Administration (MBA) It means that she is able to know how tobuild the marketing strategy and implementing suitable marketing activities for abusiness One of the owners of Viet Phat shared that:

“We believe in her expertise because she not only graduated as a MBA but also have experiences in managing field for 4 years Additionally, she has experiences working

in marketing department for 1 year It is very useful to let her acknowledge obviously about the marketing aspect.” (Mr Quang Dang, one of the owners of Viet Phat)

Hence, it is stated that Ms Van Le has ability to be in charge of marketing department.However, it depends too much on her, there is no one help her doing marketingactivities Furthermore, she has to manage all activities in the company, it takes herlots of tome to accomplish them As a result, she had paid less attention to marketingactivities She stated:

“Everyday, I have many activities to control and manage It takes most of my time, so I cannot take more time to conduct marketing activities carefully although I really want to

do that Sometimes, I create new ideas to approach more customers and promote our

products and brand, but I did not have time to conduct them.” (Ms Van Le, CEO and the one in charge of marketing department of Viet Phat)

Therefore, it can be said that the B.O.D let Ms Van Le manage marketing department

is not wrong, but they should hire more employees to support her do those tasks better

3.2 Initial Cause-Effect Map

Figure 3.1 The initial cause-effect map of Viet Phat

3.3 Main cause validation

3.3.1 Lack of B.O.D’s attention

According to Zahra and Pearce (1989), they said about the role of the B.O.D:

“places a premium on a board’s strategic contribution, specifically the board’sinvolvement in and contribution to the articulation of the firm’s mission, thedevelopment of the firm’s strategy and the setting of guidelines for implementationand effective control of the chosen strategy” (8) In conceptualization, the board’sinvolvement has been required to range from working with management so as todevelop strategic direction to simply ratifying management’s proposals (9) The B.O.Dhas many responsibilities with the company According to a survey implemented byStiles (10), it is expressed in the table below:

Table 3.1 The role of B.O.D from the interview’s result (Journal of Management

Studies)

Based on the above table, although the B.O.D takes many responsibilities, theỉr mainrole is the strategy involvement In 2001, Stiles had conducted a survey to determinethe frequency of the B.O.D in strategy involvement (10) Its result has been displayed

in the table below:

Table 3.2 The board’s involvement in developing the corporate strategy (Journal of

“We had pay attention to them as we really want it to develop as much as possible We obviously know about the importance of marketing strategy to the business development.

It plays a vital role in making more people know clearly about Viet Phat and promoting the business in order to positioning its brand in the market and also reaching more potential customers.” (Mr Quang Dang, one of the owners of Viet Phat)

According to the CEO of Viet Phat, she admitted that she known clearly the benefitsthat marketing strategy can bring to the company Thus, she always tries her best topay attention to the marketing aspect, especially the marketing strategy However,sometimes she did not have enough time and resources to invest in develop marketingstrategy She said:

“I always try my best to develop the marketing field, especially the marketing strategy Nonetheless, sometimes I do not have enough time and also human resources to support

me doing it I need to do many tasks to control activities in the company to ensure that

they have been done complying with the development direction of Viet Phat in the future Furthermore, there is no one supporting me to accomplish those tasks in marketing field It causes many obstacles for me in developing marketing strategy.” (Ms Van Le, CEO of Viet Phat)

Moreover, when Ms Van Le was asked about the attention the B.O.D to the marketingaspect, she replied:

“In my point of view, I realized that they have paid lots of attention to the marketing field because they always require me concentrate on develop it However, as Viet Phat

is a new business, they want to save costs as much as possible Thus, they cannot provide enough resources for me to work effectively.” (Ms Van Le, CEO of Viet Phat)

As a result, from above arguments it can be stated that lack of marketing activities ofViet Phat is not caused by lack of attention from its B.O.D It seems that they reallywant to pay more attention to it but they do not have sufficient resources to do it

3.3.2 Wrong personnel

People are the important assets that creating an organization’s growth Thecontribution of each of the staffs can be a milestone in a business’s performance andachievements (11) It is normal that employees might contribute to the success or failure

of the business according to their performance (12) If they work effectively, everythingwill be done properly even in the first time (13) Hence, it helps the firm not only savingtime and costs but also developing business When employees do not have goodperformance, it cannot satisfy the customers, so they feel that the firm is nonchalant totheir needs, and will seek help elsewhere (13) Moreover, they also negatively affect otherstaffs in the company because they create the bad working environment As a result, thecompany is the party that has to suffer the most significant impacts, such as driving downsales, stagnant tasks, late processing work, waste lots of unnecessary expenses, etc On theother hand, hiring the right person is considered as an important factor that helps thebusiness move in a positive direction and become more successful in the future (14).According to LeBow (15), “having strong, dedicated people can make a good managerlook like a legendary leader” Therefore, Chaves (12) stated: “finding

the right people is so critical to the success of organizations” Regarding with personnel,

Ms Van Le is responsible for the marketing department of the company, and there is noone to support her doing those tasks With the background of having been graduated as

a Master of Business Administration (MBA), 4-year-experience in managing field, and1-year-experience working in marketing team, it is believed that she has had ability to

be in charge of the jobs of both CEO and marketing department She has sufficientknowledge, skills, and also expertise to work in this position and accomplish requiredtasks Mr Quang Dang said:

“We believe in her expertise because she not only graduated as a MBA but also have experiences in managing field for 4 years Additionally, she has experiences working

in marketing department for 1 year It is very useful to let her acknowledge obviously about the marketing aspect Most of activities in the company are controlled effectively

by her She makes them occurred smoothly, they were rarely stuck ” (Mr Quang Dang, one of the owners of Viet Phat)

Additionally, when being asked about what the employees thought about Ms Van Le’sworking performance, they replied:

“When I worked with her, I felt comfortable because she empowered me some rights to make decisions, and gave me clear objective to gain I can know exactly what I had to

do to achieve those goals Moreover, my job has done quickly and effectively as I was empowered to make some decisions by my own Hence, I think she is very professional

in working and soft skills.” (Mr Nam Tran, sales staff)

“In my point of view, she has great expertise in managing and marketing field Particularly, she know exactly what make employee satisfaction increasing As when employees satisfied with their job, they would work effectively She is very flexible when she gave us discount range, but not discount rate It means that we can deal with customers with a flexible discount rate as long as it is in the allowable range, not a constant one It makes our job done well Furthermore, sometimes she also instructs

me some techniques and skills to persuade customers and promote our products to them.” (Ms Minh Le, sales staff)

According to all of the above arguments, wrong personnel cannot be a main cause thatleads to the problem of lack of marketing activities It can be seen that Viet Phat chosethe correct personnel for marketing position, but she needs more help from the humanresource to work effectively.

3.3.3 Lack of resources

As a new and small business, lack of resources is inevitable to Viet Phat In theinitial stage, its owners have to uitilize capital to many different things in order tomaintain and develop it Simultaneously, the capital is limited, so they sometimes cannothave enough money to afford all of the company’s activities As a result, they always puttheir efforts to save costs as much as possible “A lack of resources (whether financial,human or physical resources) would significantly affect your business – and for theworse” (16) In particular, regarding with the human resource, Viet Phat does not havemany staffs like other companies and each staff has to do more tasks than the one in thesame position in other firms because its owners would like to save more costs for it.Therefore, it may lead to the ineffectiveness in working Nonetheless, hiring and retainingenough excellent employees is considered as one of key business success factors (17) Forexample, it should have had a marketing department with manager and staffs to conductmarketing activities and build the marketing strategy instead of let its CEO do bothmanging and marketing tasks In addition, she has to do marketing tasks by her own, there

is no one to support her in doing it because Viet Phat does not have sufficient financialresource and human resource Hence, it leads to the ineffetiveness in both building amarketing strategy and develop it Specifically, Mr Quang Dang shared:

“As Viet Phat is in the initial stage of a start-up business, lack of resources finance, human, amd also physical is inevitable Regarding with financial resource, we have limited amount of money that can use to invest in Viet Phat Moreover, we did not allow other investors put money to it except the owners of Viet Phat Therefore, sometimes we do not have enough money to cover all of activities in the company, so we have to cut costs

as much as possible Lack of financial resource does not allow us achieving more elite employees They do not want to work for a new and small firm as it cannot pay them a very good salary and benefits As a result, recruiting talent people that agree to

work for Viet Phat is so hard Thus, lack of human resource is also considered as an obstacle of Viet Phat immediately.” (Mr Quang Dang, one of the owners of Viet Phat)

As mentioned above, because there is lack of human resource that can support Ms Van

Le in marketing aspect, she cannot have enough time to focus on too many thingssimultaneously Even though she has an excellent expertise in marketing field, shecannot accomplish everything required by the B.O.D effectively Not only does nothave sufficient capital to recruit more employees, but it also sometimes does not afford

to conduct some big marketing campaigns Thus, it may affect negatively to buildingmarketing startegy and developing it Especially, the digital marketing has a vital role

in marketing aspect, and the key factor in digital marketing is social media It takes notonly lots of money but also other resources to conduct social media plans Some newsurveys stated that 26% of businesses said that insufficient staffing or budget is theirmain difficulty to success with social media (18) “More than 25% of social mediamarketers say this shortage of resources is their biggest obstacle to a successful socialmedia plan” (18) Additionally, the amount of time that Ms Van Le can devote forbuilding marketing strategy plays an important role in contributing to the success ofthe marketing aspect Therefore, it can be said that lack of resource is the main causelead to the problem of lack of marketing strategy