BUILDING BUSINESS STRATEGY MACHINERY JOINT STOCK COMPANY – TKV V ACKNOWLEDGEMENT The research group would like to thank Teachers of Griggs University and Centre for Educational Technology and Career Development – Vietnam National University for helping and instructing our group with basis and methodology of the report We would like to thank Dr Phung Manh Dac – Deputy General Director of TKV Group, Chairman of Administration Board of VMC Company; Dr Ta Ngoc Hai – TKV Mechanics Department Manager; Mr Cao Ngoc Dau – Institute Head of Mine Energy Mechanics and Mr Nguyen Cong Hoan – Director of VMC company for contributing ideas and creating conditions for us to complete this report APPENDIX ACKNOWLEDGEMENT .ii APPENDIX iii List of abbreviated words v List of tables v Introduction: GENERAL INTRODUCTION Chapter I: REASONING BACKGROUND 1.1 Overview of business strategy 1.1.1 Concept of business strategy 1.1.2 Administering business strategy 1.1.3 Benefits and limitations in business strategy building 1.2 Method of building business strategy 1.2.1 Analyzing environmental factors affecting business strategy .6 1.2.2 Method of analyzing and forecasting strategy .9 1.2.3 Analyzing SWOT 11 1.2.4 Determining competition status of the enterprise 12 1.2 Choosing business strategy 15 1.2.1 Concentrated growth strategy 15 1.2.2 Diversification strategy 16 1.3 Implementing the strategy 18 1.3.1 Reviewing strategic environment 19 1.3.2 Evaluating, adjusting and ensuring resources 20 1.3.3 Determining organization structure to implement the strategy 20 1.4 Checking and evaluating business strategy 21 1.4.1 Controlling basic grounds of company’s strategy .21 1.4.2 Reviewing basis of the strategy 21 1.5 Research method of the report 22 1.6 Scientific and practical meaning of the report 22 Chapter II: ANALYZING REAL STATE OF VMC 23 2.1 Overview of the enterprise 23 2.1.1 Process of establishing, developing of VMC 24 2.1.2 Human resources and organizational structure 26 2.1.3 Traditional product line of VMC 30 2.2 Analyzing situation and results of business activity of VMC from 2005 - 6/2009 35 2.2.1 Business production situation 37 2.2.2 Market 38 2.2.3 Business efficiency 39 2.3 Analyzing business environment 40 2.3.1 Analyzing external environment 40 2.3.2 Analyzing internal environment 46 2.4 Results and shortcomings of VMC in the past time 49 2.4.1 Results 49 ii 2.4.2 Shortcomings need to be improved .50 2.5 Analyzing problems of strategy and administration of VMC .50 2.5.1 General objective of the strategy 50 2.5.2 Strategy orientation 50 2.5.3 Basic objectives 51 2.5.4 Affecting factors 52 Chapter III SOLUTIONS, RECOMMENDATIONS AND CONCLUSION .56 3.1 Recommending business strategy .56 3.2 Basic solution to implement and administer business strategy 56 3.2.1 Modernizing manufacturing technology 56 3.2.2 Modernizing repair technology 57 3.2.3 Improving energy supply system 57 3.2.4 Human resources development strategy 58 3.2.5 Technological science development strategy .58 2.3.6 Protecting environment and industrial hygiene 60 3.2.7 Ensuring labor safety, occupational disease 60 3.2.8 Expanding cooperation, association 60 3.2.9 Building and developing trade mark 61 3.3 Proposal .61 3.4 Conclusion 61 REFERENCES 64 iii List of abbreviated words HĐQT TKV VMC WTO EPC CNC FO CAT COALIMEX MATEXIM LILAMA LICOGI VINAINCON IMSAT NARIME Administration Board Vietnam Coal – Mineral Industry Group VINACOMIN- MACHINERY JOIN STOCK COMPANY World Trade Organization Engineering - Procurement - Construction Computer Numerical Control Fuel Oil Caterpillar Inc Coal import and export joint stock company - TKV Material and Complete Equipment Export-import Corporation Vietnam Machinery Erection Corporation Infrastructure Development and Construction Corporation Vietnam Industrial Construction Corporation Institute for Medical Science and Technology Institute for Mechanical Engineering List of tables Table 1.1 Table 2.1 Table 2.2 Table 2.3 Table 2.4 Evaluating influences of business environment Labor structure of VMC Labor quality of VMC Quality of manufacturing, repairing products of VMC Business operation results of VMC from 2005 – 6/2009 Table 2.5 Table 2.6 Business operation results Exhibit value of Company from 2005 - 2009 Mechanics production value and revenue density of units in 33 41 Table 2.7 Table 2.8 the sector Table of synthesizing business environment of VMC SWOT matrix of VMC 48 50 Figure 1.1 Figure 1.2 Figure 1.3 Figure 1.4 Figure 1.5 Figure 1.6 Figure 2.1 Figure 2.2 Mc Kinsey matrix IE matrix Concentrating on a market part Specializing the market Optional specialization including many parts Specializing products Organizational model of VMC Company Sectional sale revenue density 12 14 15 15 15 15 27 34 iv 10 26 26 29 - 31 32 Figure 2.3 Profit rate on revenue Figure 2.4 Competition status of VMC Figure 2.5 I.E matrix of VMC 35 48 50 v Introduction: GENERAL INTRODUCTION Machinery Joint stock company – TKV (Vietnam Mine – Minerals), which is abbreviated as VMC (VINACOMIN- MACHINERY JOIN STOCK COMPANY) was changed from Cam Pha Central Mechanics Company The company was established in 1968, has headquarters at 486, Tran Phu Road, Cam Pha town, Quang Ninh For years of building and developing, VMC has become the leading equipment, accessories manufacturing company in Vietnam and is gradually reaching to international market Products of VMC mainly are equipment, accessories serving mine ores, cement, and electricity industry in the whole country Scale of the enterprise is relatively big with 1300 staff and annual revenue is about VND 800 billion Average growth speed of the company in the last five years has reached 20%/year VMC organizes production into blocks: Accurate processing, Steel component production, rough draft supply (founding, processing pressure) and other auxiliary production At present, VMC is a joint stock company under Vietnam Mine - Mineral Group The company has relatively diversified number of commodities, has many customers of different organizations For many years, VMC has had many achievements in business production, contributing to industrialization – modernization process of Vietnam mechanics sector in general and mine sector in particular To be in accordance with the market economy and international economic integration that Vietnam is building and developing, implementing Decree No 109/2007/NĐ-CP dated June 21st, 2007 of Prime Minister on changing State owned enterprise to join stock company and Resolution of HĐQT of Vietnam Mine - Mineral Group on changing enterprises in the group to operate according to equitization model, from March 30 th, 2008, VMC has officially changed operation to Joint stock enterprise model with ownership structure as follow: State holds 36%, staff hold 37,5%, trade union hold 1,5% and external shareholders hold 25% Charter capital of VMC is VND 40.850 million Before changing to equitization, VMC operated according to State Enterprise Law and was controlled by plan of superior, and thus business strategy building and administration of the company was not displayed clearly Business production activities of VMC mainly were to ensure output and revenue according to the assigned plan, even profit target When changing to operate according to charter of joint stock company, it is clear that VMC has to become more initiative and pay more attention to business strategy building and administration of the company This is also a common CERN of all the enterprises when changing from State owned companies to joint stock ones From the real state above, our study group did choose the theme: “BUILDING BUSINESS STRATEGY FOR MACHINERY JOINT STOCK COMPANY – TKV FROM 2010 TO 2015” to be the content of Graduation big exercise of International business administration master training program The objective of this report is to evaluate relatively comprehensive the real state of business production of VMC Find existing advantages, strong points as well as challenges, weak points of the company At the same time, discover opportunities, risks threatening the company in the future From that, build business strategy of VMC from 2010 to 2015 Study group set the mark of 2015 for business strategy of VMC to give petition and recommend relatively comprehensive and specific solutions However, our group also set a goal that business strategy of VMC must have look forward to 2020 to be in accordance with the Coal development sector strategy which was built, as well as Decision No 186/2002/QĐ-TTg dated December 26th, 2002 of Prime Minister regarding ratifying development strategy for Vietnam mechanics sector to 2010, looking forward to 2020 Research scale of this report is REASONING BACKGROUND on building business strategy; studying, analyzing the real state of the enterprise to build the most fundamental business strategy for studied enterprise – VMC The report has main parts as follow: Chapter 1: Reasoning background on business strategy In this part, the report will show concepts of business strategy and processes to make a business strategy in the most fundamental way Chapter 2: Analyzing the real state of VMC In this part, the report will concentrate on introducing the overview of VMC, collecting and analyzing, evaluating the business production situation of VMC in recent years The research group finds out strong, weak points, opportunities and challenges of the enterprise From that, build business strategy of VMC from 2010 to 2015 Chapter 3: Solution, proposal and conclusion The research group recommends comprehensive, specific solutions for VMC and petition for VMC, superior agency and State Our group hopes to apply knowledge from the course of the International Business Administration Master Training Program, Griggs University, United State into practice This report both helps members of the group improve knowledge and is a useful scientific report for VMC Company to apply in practice Chapter I: REASONING BACKGROUND 1.1 Overview of business strategy 1.1.1 Concept of business strategy Term “strategy” originating from Greek language with two words “Stratos” means military, formation and word “Agoss” means leadership, control The strategy was used firstly in military to illustrate big, long-term plans which were given on the reliable basis that what the enemy could and could not Commonly, strategy is understood as science and art of military control, is applied to make general plan and carry out large-scale campaign Beginning from the 1960s of the 20th century, strategy has been applied in business area and term “Business strategy” was born Over time, people access to it in different ways According to traditional approach, strategy means determining long-term basic targets of the enterprise and implementing action program together with distributing necessary resources to reach determined targets We can also understand that strategy is a way that enterprises use to orient the future to reach and maintain development At present, term “business strategy” is used with three most common meanings: determining long-term, basic goal of the enterprise; giving general action programs; choosing action plans, implementing to distributing natural resources to that goal Specific feature of strategy is moving and attacking In the process of administering strategy, we must attach special importance to forecast, take initiative in anticipating changes of the business environment to outline offensive solutions to take advantage of opportunities, restrict possible risks in business environment of the enterprise M Porter brings out three common types of competition strategy: minimal cost, special difference and central making He also give out a very exact analysis diagram to study an operation field and develop new concept “value series”, helping enterprises determine their own competition advantages 1.1.2 Administering business strategy Is a process of determining strategic goals of the organization, building policies and plans to achieve goals and allocate resources of the organization for the implementation of theses policies, plans The process of administering strategy is implemented through four main stages: - Analyzing the situation: includes external and internal environment This analysis often involves political, environmental, social, technological analysis; analysis of factors affecting the organization and of strong, weak points, opportunities, challenges - Building strategy: includes determination of mission, establishment of goals, strategy and policy proposal - Implementing strategy: includes action programs, budget, and process - Evaluating and controlling: involve evaluation of results and making of necessary adjustments When building strategy, we understand that, business strategy does not mean determining goals, visibility of the enterprise; but business strategy must be proposals with unique nature and be suitable to the enterprise in each certain stage Strategy needs to create a different value chain from competitor, and clearly determine what needs or need not to be done, and show unchanged nature in positioning 1.1.3 Benefits and limitations in business strategy building In the market economy, building and implementation of business strategy will bring about following benefits for the enterprise: difficulty and achieved many great results so that they has set up their own trademark in the domestic and foreign market They at first just did the work of mechanical manufacturing and then manufactured, constructed reached the target of overtaken the whole EPC project In term of the manufacturing management, originally the link among the consultant, mechanical units in the whole group is so close that that they gather to cooperate to complete structural construction and equipment mechanization agreement 2.4.1 Results - Setting up and develop VMC to become one of Vietnamese greatest coal and mechanical enterprise which have the big ability of technology equipment and long-time experience in rebuilding mineral exploiting and construction material - Well remaining equipment technology force, in accordance with equip advanced technical assemblies advanced and synchronously with the staff skilled They have the capability of producing spare parts, machines and equipment that are totally diversified and meet the market demands - Creating believed trademark in mechanical sector in Vietnam Building the stable resources in finance, materials and human resources, trade marks As a result, the key values of VMC in the coming business strategy are established 2.4.2 Shortcomings need to be improved - Staff of engineer and management has not adopted with current requirements, especially now VMC is taking over many EPC projects - Finance is not powerful - Company has invested some technique devices, but there are also many unfashionable devices which affect the quality of products, so that the capacity of competition is not high - The innovation in enterprise managing is limited, the researches and applications in new products have also limits, researches and research application in new products, market still have many limitations, are passive 47 2.5 Analyzing problems of strategy and administration of VMC 2.5.1 General objective of the strategy - Preserving and developing the owner capital flow with growth level no less than 10%/year - Profit ratio on turnover of consuming products no more than 1%, level of income no less than 1.5 times compared saving interest sending in bank in the same period - Speed of raising annual turnover no less than 25%; production and consuming ratio of external sector is no less than 30% 2.5.2 Strategy orientation To carry out above targets, VMC needs to build business strategy with basic orientation: - Developing the human resources - Modernizing the technique, renovating devices which serve the task of manufacturing machines - Modernizing the repairing technique - Developing the technique science under the direction of upholding potential and inheriting the modern technique in the world - Protecting environment and industrial hygiene, working safety to ensure sustainable development of VMC and the sector; - Mobilizing and preserving capital to serving development goals - Cooperating in domestic and overseas to expanding markets - Building and developing trademark together with broadening and growing 2.5.3 Basic objectives - Paying attention to unified products, raising cooperation of manufacturing, assembling the main lines of products such as excavator EKG 10, machine of digging furnace AM 50Z, manufacturing the anti-water force 48 pillars, furnace excavators, improving the manufacturing of VINANTA and many types of devices serving mineral processing - Raising the capacity of manufacturing mechanical parts with the average output 5,120 tons/year equal to 100% designing capacity The priorities must be exploiting devices of coal such as parts and moving chains for excavators EKG 4.6; 5A; 8U and EKG 10; machine of digging mines Combai; drilling machine CBIII 250 MHA 32; moving machine D85; D155; D355 Coal excavator KSW- 460E, stone excavator EMICO 612C - Raising the capacity of producing casting steel: including casting steel for construction, U-shaped, I-shaped steel Since 2010 VMC self-provides all devices for mines with the output of 80,000 to 100,000 tons/year - Rationalizing the production, completing technique to meeting maximum demands for repairing devices of exploiting open-cast mines, cellars, and devices of Coal company and other enterprises in the region under the direction of group replacing repair - About the market, maintain the traditional market inside and outside the industry Raising marketing activities to expand the market outside coal industry, especially, the industry of processing mineral, material, and energy Raising the capacity of manufacturing export goods with the objective is export accessory revenue of above 20 million USD, equivalent 15% of sales revenue of VMC 2.5.4 Affecting factors With above analysis, we see that VMC needs to build a business strategy for the period of 2010-2015, 2020 outlook We will analyze the relation between strong points and weak points of internal VMC with opportunities and threats of business environment which VMC joints in; strategy status (I.E matrix) and competitive capacity (MC KINSEY matrix) help VMC select the optimal business strategy Then VMC sets up the directions to implement monitor with the aim of upholding maximum the key capacity of VMC 49 - Competitive capacity of VMC: Basing on above analysis, we build the MC KINSEY matrix (figure 2.4) Strong Medium Weak High Attraction of VMC mechanical Medium Weak Capacity of competition of VMC Figure 2.4 Competitive status of VMC VMC has good capacity of competition The attraction of manufacturing sector is in level of medium due to some obstacles and specific elements The competitive status of VMC is interposing between green part and yellow part which showed in MC KINSEY (figure 2.4) - Elements of environment: basing on above analysis of VMC in relation between internal and external factors, we calculate the point values with the standards on the table of business environment (table 2.7) Table 2.7 Collecting the business environment of VMC Environmental elements Outside elements Integration trend, opening, joining WTO Rapid development of technique Environment of politic and law Competing pressure on providers Pressures from customers Pressures from hidden competitors Competing pressures from replacing products Competing pressures inside sector Inside elements Important level of elements for sector (high 3, medium 2, weak 2) Effect on VMC (much 3, medium 2, less 1, no effect 0) Affecting features of elements (positive +, negative -) Total points 2 + +4 3 + +9 + +6 1 - -1 - -6 -1 - -6 - -2 50 Infrastructure, technique equipment Human resources Geographical places Economic zone of active development convenient Import-export activities Discipline of production and technique is weak no differences among products Product price is not competitive Information managing and monitoring mass projects have shortcomings - + +6 3 2 + + + +9 +4 +6 2 + +4 - -2 2 - -4 - -2 2 - -2 -4 Strategic status of VMC: we build I.E matrix to define the strategic status of VMC in relation with affecting elements of outside and inside environment (figure 2) EFE IFE I II III IV V VI VII VIII IX Figure 2.5 I E matrix of VMC The total of points of positive factors and negative factors in each group of internal factors and external factors, PointIFE = 3.13; PointEFE = 3.0 We define the point of strategic status of VMC in I.E matrix VMC belongs to the region of developing and building (figure 2.5) - SWOT matrix (table 2.8) is built with the strong points, weak points of enterprises, together with opportunities and challenges of business 51 environment It considered as foundation to defining the suitable business strategy Table 2.8 SWOT matrix of VMC SWOT matrix Opportunity- Strong points Weak points - Infrastructure, equipment, technique - Human resources - Convenient economic geographical - Discipline of production and place - Economic zone of active development - Activities of export and import are convenient SO strategy - Big market of inside sector - Covering the traditional markets - Market of outside sector is - Improving the markets of outside broadening - Good cooperation - Moving trend in society creates favorable play ground - Opportunities of renovating equipment, technique with low cost Threats sector - Improving the production of exportgoods - Improving development investment ST strategy technique is weak - No differences among products - Product price is not competitive - Information - Managing and monitoring mass projects have shortcomings WO strategy - Developing the market of outside sector under the direction of business cooperation - Broadening the inside-sector market - Improving the fields of creating competitive products WT strategy - Sector market is big but it - Improving to produce traditional - Focusing on traditional market is not broadened - Increasing competition with export goods - Attract talents difficultly - Need to renovate old equipment - Increasing domestic competition products - Broadening inside-sector market, taking advantages of available equipment - Diversifying the activities of VMC under consensus direction to sustain development - Improving domestic cooperation and diversifying under the direction of mixture - Priorities must be the field of low cost, collecting capital rapidly 52 Chapter III SOLUTIONS, RECOMMENDATIONS AND CONCLUSION 3.1 Recommending business strategy With the strategies showed in the matrix SWOT, competitive status in MC KINSEY matrix and the competitive status of VMC in I.E matrix, the group of research builds the business strategy of VMC in period of 2010- 2015 as follow: “ Mobilizing maximum the resources, upholding the advantages, focusing on growth and developing new markets; Investing, renewing the technique, differentiating the products under the trend of raising quality; raising the effectiveness of business activities and quality of human resources, sustainable development of businesses 3.2 Basic solution to implement and administer business strategy To carrying out the business strategies, VMC needs to implement entirely solutions under the principles of upholding maximum resources and available advantages to developing financial effectiveness, which lays the foundation for long-term strategies We propose some solutions for VMC including: 3.2.1 Modernizing manufacturing technology - Upgrading, modernizing some available devices to raise speed of working, accuracy and scope of applying devices - Renovating, modernizing devices and technique to raise the capacity of making heavy machinery devices, devices of super- weight, accuracy devices - Completing and upgrading the production capacity of process of pressure outwork Installing hammering machine 2000 to manufacturing big axis serving building shift - Completing and upgrading the system of checking temperature to raising the quality of thermal treatment system Improving the system of 53 tempering under form of axis and disc; modernizing the process of checking temperature by the current advanced devices - Upgrading the devices, completing the technique of making parts of machine (metallurgy, making FURAN) with the output of 6.000tons/year Focusing on the products of composition steel, abrasion steel 3.2.2 Modernizing repair technology - Improving the making use of repairing lines of moving machine and water force excavator, improving the output to 100 sets/year - Investing and modernizing the repairing technique, excavator assembling, circle driller, selecting devices and harbor - Improving the group capacity, provision parts to meet the demands of liberating the repairing devices, overcome the limits of supplying parts - Preparing the mine devices, applying the regime of lending in limited time and ensuring quality of products after the period of warranty to help customers remaining production 3.2.3 Improving energy supply system - Maintaining the station 35/6 kV and transformer stations 6/0,4 kV in the space of company Ensuring the enough provision of capacity (10.000 kVA) Replacing the methods of managing, transfer level of measuring from net to net 35 to raise the economic effectiveness - Completing the circulated water system Raising the effectiveness of withdrawing water through system, ensure the reusing capacity no less than 85% - Cultivating, upgrading the finery system, raising the effectiveness of using calorie, automating the process of controlling temperature 3.2.4 Human resources development strategy Building, drawing, training the cadres having enough ability of designing, technique, consulting, technical monitoring Meeting the demands for technical renovation, part renovation under the trend of modernization 54 - Building, drawing, training the cadres have enough qualifications of investment project managing, managing the works, implementing the EPC projects in nation - Raising the refresh training, retraining the staff of technical workers Paying attention more to the fields which are shortage of head workers such as: hydraulic, industrial electricity, CNC control - Adding the conditions of working for technical cadres, staff Using effectively the advance of information technique Streamlining the indirect cadres and raising the responsibility and effectiveness of each cadres - Building the regime of paying salary, awards for technical staff to encourage skillful and effective workers It is necessary to have a regime of recruiting young and intelligent engineers to replace the retired staff 3.2.5 Technological science development strategy Developing the technique science is indispensable for company It needs to be developed under the following directions: - Renovating the technique under the following methods o Cultivating, modernizing the traditional technique: basing on the traditional technique, company has methods of renovating to advanced technique o Researching new technique: combination the modernizing with self-studying to develop new technique having accuracy, replace current technique In addition, cooperating with science centers, firms, units of manufacturing in domestic and foreign to catching modern technique o Importing and transferring new and modern technique from abroad This is the development method which brings about the equal change of quality for technical elements - Building, organizing the technical staff: 55 o Building the strong technical staff to designing comprehensive devices following the groups of product: thermo-electric, hydroelectric, cement, transportation, selection, exploiting machine up to 2015, departments under technical group must have head workers reaching the knowledge of Dr Technical staff must be strong to help VMC joining in EPC contractsindispensable trend of market economy o Turning some departments into research centers, which manufacture high-quality devices competing with powers in region or reaching the export standards Product development strategy considered as important process of enterprise o Raising the capacity of building, using equipment or modern designing software to improve quality and designing speed of products - Priority must be renovation of technique devices under the suitable direction It must be balance between financial potential and development demand o Paying attention more to devices, technique which affect directly VMC development, especially the system of thermal treatment, laminating steel o Renovating the technique of casting the composition steel which lays the base for the break through of VMC device manufacturing o Cultivating and compounding manufacturing technique of combination structures, using the advanced devices: cutting, bending, battering CNC, wielding co2, contacting, non-contacting 2.3.6 Protecting environment and industrial hygiene Completing the system of industrial waste processing in 2010 56 - Investing, cultivating the system of industrial waste processing to ensure environment, reusing water for production, raising the circulation rate to 90% by 2015 - Replacing the technique of contaminating, order of priority is from surface cleaning technique; covering, casting; doing outwork - Raising green trees, concreting the industrial ground, inside roads, cultivating the micro-climate environment 3.2.7 Ensuring labor safety, occupational disease - Applying widely the advanced technique to rejecting risks of losing safety - Ensuring environment and organizing work places suitably - Building and implementing strictly the regulations, procedure, technical requirements and working discipline - Training, instructing the procedure of working safety for workers, manager and completing sanctions for working safety - Implementing enough regulations of labor guarantee; checking health periodically and health care 3.2.8 Expanding cooperation, association - Cooperating with firms: RemaG- Poland; OMZ-GO&T- Uraina; ALTA- Sec, manufacturing the devices AM50Z, EKG 8, 10; VINALTA - Connecting widely with institutes of IMSAT, NARIME, companies LILAMA, VINACONEX, VINAINCON, to developing mass projects under form of EPC such as thermo-electricity, mineral exploitation, selecting, drilling of VMC 3.2.9 Building and developing trade mark - VMC needs to invest properly to developing trademark In addition, VMC must have part of managing trademark - Registering to use goods label, trademark with Department of Intelligence Possession- Ministry of Technique Science and Environment 57 Through this process, VMC registers label in foreign (under the treaty of Madrid) - Paying attention to the task of registering the possession rights for other forms of industrial possessions: industrial shapes (for products of high quality and stability); inventions, useful methods need to be cared 3.3 Proposal Together with implement solutions and carrying out the business strategy in the period of 2010-2015, VMC needs to propose to Vietnam Mine - Mineral Group to get the regime of managing inside sector, create the favorable conditions for implementing strategy Have the policies of rising inside cooperation (TKV Group) to upholding capacity of designing new products from Research Institutes and Companies of mechanical manufacturing Forming the regime of cooperation among inside units to raise the capacity and experience of implementing large projects or raise the competition with international contractors Renovating the thought in mechanical development, raising the specialization and cooperation among TKV units to upholding available strength to reduce refresh investment cost, avoid the repeat, and create the competitive products 3.4 Conclusion Developing the mechanical sector under modernization- industrialization direction is indispensable trend of developing countries In the context of integration, enterprises and mechanical sectors need to build rapidly the policies as well as development strategies to meet the demands for growth In the coming years, the sector of coal and mineral in Vietnam will implement the activities of processing coal and other activities of electricity, bauxite-aluminum, iron ore, cement, and chemical substances together with 58 producing devices serving mine exploitation deeply Group of coal and mineral also builds and exploits new electric plants, processes aluminum in West Highlands, Titan in central zone, metallurgy These plans require large manufacturing mass and device repairing so that it is necessary some investment projects of infrastructure Statistics and general analysis about business activities of VMC show the strong and weak points, advantages, challenges of VMC Therefore, VMC needs to define that above reality is both opportunity and challenge Leaders of company must renovate the thought of implementing strategies, raise specialization, cooperation among units, uphold the available strength to reducing refresh investment cost, and create competitive products in domestic and abroad markets 2010- 2015 business strategies and 2020 outlook of researching group for VMC considered thought result basing on analysis and statistics, references provided by VMC They are also built on science base of MBA program together with business knowledge in the field of manufacturing of members in the group of research They ensure the elements: inheriting selectively, advance for acquiring new thought in modern strategy managing; suitable with the key values of VMC as well as strategy orientation of sector and nation; stable development because of having both rapid growth measures and deep development investment With basic methods, report proposes some detail contents for VMC to ensure the task of implementing business strategies Because of limited time, the task of collecting primary statistics, controlling market face difficulties Members have little real experience in setting up business strategies for mechanical enterprises so that report has may shortcomings However, our report is conducted scientifically We believe that this report will play practical role for VMC in managing, developing enterprises 59 REFERENCES English: 1- Fred R David (1995), Concepts of Strategic Management (translation into Vietnamese with the title Outline on strategic administrationStatistic Publishing), 5th edition, Englewood Cliff, NJ: Prentice Hall 2- R Grunig, R Kunh (2003), Making strategy under process – Science and technique publishing 3- Charles W L Hill, Gareth R Jones (1994), “Strategic Management”, Houghton Mifflin Company 4- G Johnson, K Choles (1993), “Exploring Corporate Strategy”, Prentice Hall 5- W.Chan Kim, Renée Mauborgne 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(2004), textbook of strategic management, Hanoi University of technology 13- Nguyen Thi Ngoc Thuan (2004), Business strategy and planning the internal enterprises, science and technique publishing 14- www.doisongphapluat.com.vn- task of establishing Vietnamese group of mechanic 15- www.nghiencuumarketing.com- guiding to build some matrixes 61 ... important marks in EFE matrix High 3.0 – 4.0 Medium 2.0 – 2.99 Low 1.0 – 1.99 Total important marks in IFE matrix Strong Medium Low 3.0 – 4.0 2.0 – 2.99 1.0 – 1.99 I II III IV V VI VII VIII IX 14... quality, distribution capacity, brand name prestige, cost price of product unit, production technology, advertising efficiency, production scale, internal financial capacity, R and D ability)... The enterprise, when analyzing macro environment needs to use PESLTE (Policy – Economic - Social – Technology - Law – Environment) model When making business on an administrative unit, enterprises