Case Study: Rang Dong Plastic Joint-Stock Company (RDP)

Company: Rang Dong Plastic Joint-Stock Company (RDP) Industry: Household and Engineering Plastic products Year: 2009

Company Profile
Rang Dong Plastic Joint-Stock Company, (abbreviated to RDP), was established under the original name of UFEOC (Union Francaise d Extreme dOrient des Caoutchouc) in 1962 in District 11, Saigon, Vietnam. From the early days, RDP has experienced rapid growth, and by 2009, the companys nation-wide operations generated annual sales amounting to over five hundred billion Vietnam dong (approximately thirty million US dollars). Over the five year period from 2005 turnover has grown by just over 55 per cent, i.e. an average annual growth rate of over 11 per cent. Financial information of Rang Dong Plastic Joint-Stock Company over the last five years is summarized in Table 1. RDP is engaged in the development, production and distribution of household and engineering plastic products and has become a major player in this industry. Products and technologies emphasized and developed by RDP have set the standards in many key areas. Examples include performance standards for multi-layer flexible film packaging, which have been developed by RDP in co-operation with technological institutes and universities, as well as major innovations in the fields of EVA films and sheets, PU synthetic leather, and PE rigid sheets & boards. From its location in district 11, Saigon, the firm has developed a sales and distribution network throughout Vietnam. Both products and technical know-how are readily available on a national scale, based on a network of local sales, service and customer advisory centres. Company operations include production facilities in District 11, Cu Chi district, Hoc Mon district (Saigon) and Binh Duong province in the south of Vietnam, as well as Khanh Hoa province for the North and Central markets. Besides its head office, RDP has three other operational sites, Hanoi branch, Nghe An branch and Nha Trang branch (see Figure 4).

Organizational Structure
RDPs organizational structure may best be classified as a hybrid structure. It combines an activity grouping of functional areas such as research and development, production, logistics, general administration including purchasing, finance and accounting, and the like, on the one hand, and a product-based or output grouping, focusing on sales - which is structured around product divisions - on the other hand. For all areas except sales, this form of concentration brings with it the advantage of high efficiency. The sales activities, however, which are considered to be of major importance for the success of the whole company, are structured to meet the overarching goal of customer satisfaction first and foremost. The use of separate sales divisions for the product lines allows the company to focus on the specific needs of certain customer groups. The same is true for

affiliated companies, which may be regarded as externalized sales departments for special product lines, serving special customer segments. In order to gain close contact with customers, a regional structure has been chosen within product divisions, responsible for the engagement of sales representatives. Based on regional sales offices throughout Vietnam, regional markets can be served effectively. It should be emphasized again that there is no formal or even fixed organization structure and the above represents a summary based on observation of what is generally happening within RDP.

Company Philosophy
RDPs philosophy, as explicitly stated in the companys long-term plan, is directed towards delighting the customer. RDPs vision is expressed in the companys motto Innovation, competence and performance and it is a widely held view within the company that the above motto forms the cornerstone of the companys success. Underpinning this motto is a strong belief that quality, growth, profitability, valuing employees and a decentralized organization deliver the vision. RDP defines innovation as being one step ahead of the norm. Thus, the company builds on the capability of its employees in research and development, applies technology and continually assures its customers of the quality of its products and services. R&D managers are active in technical associations and committees for the creation of new standards within the plastic packaging industry. Thus, managers keep themselves up to date with the latest developments and they also recognize the challenges facing tomorrows markets. RDPs capability to innovate is also founded on research laboratories equipped with the latest technology. RDPs competence shows itself in the companys capability to find individual solutions to its customers specific demands and its wide range of back-up services. Competence is primarily developed through an ongoing staff-training programme in all technical areas and further supplemented through extensive dialogue and partnership arrangements with universities and technical institutions. Performance is considered to be the third building block of RDPs success. Performance draws on a company infrastructure equipped to deal with customers requests, as well as on highly qualified, trained and motivated employees. Supporting these two main platforms is a network of associations, co-operatives and various contact points with specialist institutions.

SOLUTION Step by Step approach to building the Balanced Scorecard

Typical ad-hoc Process for Arriving at Strategic Initiatives