CAPSTONE PROJECT

REPORT

Gamba Group 6:
01.X03 Nguyen Tu Anh
Luong Minh Tuan
Tran Luu Kien
Bui Huy Quang

Hanoi, January 2011

TOPIC

Building and selecting strategy to develop

Hanoi Western market of PetroVietnam
Finance Corporation – Thang Long Branch
(PVFC Thang Long) in 2011 – 2015 period
and vision to 2020

2 Group 6
Contents

Preface

CHAPTER 1 – Theoretical Base

CHAPTER 2- Analyse Market Situation of PVFC

Thang Long

CHAPTER 3: Development Strategy Toward Hanoi

Western Market & Solutions for PVFC Thang Long

Conclusion of the thesis

3 Group 6
CHAPTER 1 – THEORETICAL BASE

THEORETICAL
BASE

1.1. 1.2. PROCESS

STRATEGY OF BUILDING
AND STRATEGY
MARKETING
STRATEGY

4 Group 6
CHAPTER 1 – THEORETICAL BASE

1.1. STRATEGY AND MARKETING STRATEGY

 So, what is strategy?
Koontz, Ciril O’Donnell and Heinz Weihrich, authors of the
book “Essential of Management" defined strategy in three
ways as follows:
– Strategy is general action program on the deployment of
important resources to achieve comprehensive goals.
– Strategy is an organization’s program of goals and its
changes, resources and the arrangement to uses
resources to achieve goals and policies to distribute
income.
– Strategy defines basic long-term targets of an
enterprises, selects orientation of operation and allocates
necessary resources.

5 Group 6
CHAPTER 1 – THEORETICAL BASE

Strategy?

6 Group 6
CHAPTER 1 – THEORETICAL BASE
1.2. PROCESS OF BUILDING STRATEGY
External environment
analysis Building and selecting strategy
1. Macro analysis
PEST/SLEPT model
2. Micro analysis
Mc. Porter model
=> Competition pressure
in the sector
=>Opportunities and
threats
Suitable organizational structure
with selected strategy
Vision/mission
SWOT, GREAT model Internal environment analysis
Value chain model
Process of recognize sustainable
competitive edge
=>Strengths &Weaknesses
Functional strategy
Business
strategy/competition
Corporate strategy
Global strategy
Implementing and adjusting Monitoring and evaluating the
strategy strategy implementation
7 Group 6
CHAPTER 1 – THEORETICAL BASE

1.2. PROCESS OF BUILDING STRATEGY

 Mission and vision
 Objective of marketing strategy
 External environment analysis
 Internal environment analysis
 SWOT matrix
 Strategy selection

8 Group 6
CHAPTER 1 – THEORETICAL BASE

 Macro environment analysis – PEST model (Political –

Economic – Social – Technology)

9 Group 6
CHAPTER 1 – THEORETICAL BASE

 Analysis model of three-level internal and

external environment
Culture Population
Society Labor

New
entrants
Economics Politics
Suppliers Customers Law
Enterprise

Rivals Substitute
products
Technology
International
environment

10 Group 6
CHAPTER 1 – THEORETICAL BASE

Five forces model of Michael E. Porter

Threat of new market entrants

Bargaining
power of Competitive Bargaining power
suppliers rivalry within an of customers
industry

Threat of substitute products

11 Group 6
CHAPTER 1 – THEORETICAL BASE

 SWOT matrix
SWOT matrix Opportunities (O) Threats (T)
1... 1...
2... 2...
3... 3...

Strengths (S) SO strategy ST strategy

1... This strategy uses This strategy uses
2... strengths of to utilize strengths of to cope
3... external opportunities. and avoid external
threats.

Weaknesses (W) WO strategy WT strategy

1... This strategy helps This strategy helps
2... overcome weaknesses overcome weaknesses
3... of enterprise to utilize of enterprise to reduce
external opportunities external threats.

12 Group 6
CHAPTER 1 – THEORETICAL BASE

Strategy selection
There are a lot of different business strategies; generally,
there are three basic approaches to generating
competitive edge, namely:
• Cost-leadership strategy;
• Product differentiation strategy;
• Focus strategy.

13 Group 6
CHAPTER 2- ANALYSE MARKET SITUATION OF
PVFC THANG LONG

2.1. General view on PVFC

2.2. The Process of Formation and Development of
PVFC Thang Long
2.3. Market and Market share Development
situation
2.4. Assessment on market development of PVFC
Thang Long at period of 2007 – 2010
2.5. Building and selecting strategy to develop
Hanoi Western market of PetroVietnam Finance
Corporation – Thang Long Branch in 2011 –
2015 period

14 Group 6
2.1. General view on PVFC

General view on PVFC

• PVFC was founded in June 19, 2000;
• Charted capital: 5,000 billion VND
• On March 18th 2008, PVFC officially became PetroVietnam
Joint Stock Finance Corporation.
 Types of products:
(1)Investment products:
(2)Corporate finance
(3)Personal finance
(4)Accumulating corporate capital and credit
(5)Monetary trading

15 Group 6
2.2. The Process of Formation and
Development of PVFC Thang Long

The organizational structure of PVFC Thang Long

DIRECTOR

DEPUTY DIRECTOR 1 DEPUTY DIRECTOR 2

General Department
coordination finance and
department accounting

Department of
Investment Credit Transaction-
department department Risk assessment on office
and management

16 Group 6
2.2. The Process of Formation and
Development of PVFC (con.)

17 Group 6
2.2. The Process of Formation and
Development of PVFC Thang Long (con.)

Diagram of comparing revenue of products and services in

Oil and Gas industry (2009) in PVFC Thang Long and the
outside of the industry

18 Group 6
2.2. The Process of Formation and
Development of PVFC Thang Long (con.)

 Diagram of revenue of main products and services of

PVFC Thang Long 2010 (estimation)

19 Group 6
2.2. The Process of Formation and
Development of PVFC Thang Long (con.)

Main products and services

(1) Business (2) Individual (3) Investment
customers customers operations

- Credit - Project
- Capital - Capital investment
arrangement mobilization - Investing
- Developing CDM - Period purchase mandate
- Foreign - Personal credit - Bond professions
exchange trade. -Supportive stock - Trading priced
business certificates

(4) Other products and services

- Stock exchange floor

20 Group 6
2.3. Market and Market share Development
situation

PVFC Thang long and market on the West of

hanoi
• PVFC is a finance company, so it is not allowed to
practice payment function.
-> PVFC will transfer the operation model into trading bank.
->PVFC and other subsidiaries will have opportunities to
carry out payment products and services for customers.
• Therefore, the personal financial market on the
West of Hanoi is very important to PVFC Thang
Long

21 Group 6
2.3. Market and Market share Development
situation (con.)

COMPETITION in western market of Ha noi

TECKCOMBANK Citi group

AGRIBANK GP Morgan Chase
HSBC
VIETCOMBANK
Mitsubishi UFJ Financial
VIETINBANK Group
BIDV Mizuho Financial Group
MHB BANK

PVFC VIETNAMESE BANKS FOREIN BANKS

22 Group 6
2.3. Market and Market share Development
situation (con.)

 The strategy on customers of PVFC Thang

Long
• The enterprise customers
• Customers for consultancy service
• Individual customers
• The foreign customers

23 Group 6
Summarize Chapter 2

Within the Chapter 2,

• Our group applies theoretical model studied in the strategic
management course to analyze business environment and
the characteristics of Hanoi Western market, focuses on
analyzing credit institutions in the area, work force,
competitiveness of PVFC Thang Long; and

• Applies analysis of value chains of services and products of

branch PVFC – PVFC Thang Long, as well as advantages
and disadvantages of work, in order to give solutions to
development strategy toward Hanoi Western market,
which will be mentioned in Chapter 3.

24 Group 6
CHAPTER 3

DEVELOPMENT STRATEGY TOWARD HA NOI

WESTERN MARKET AND SOLUTIONS FOR
PVFC THANG LONG

25 Group 6
CHAPTER 3-

3.1. Development Target of Petrovietnam Finance

3.2. Development Orientation for PVFC Thang Long by
2015
3.3. Options in Market Development Strategy of PVFC
Thang Long
3.4. Solutions
3.5. Suggest some supporting solutions
3.6. Limitations of report and the next researching
orientation

26 Group 6
3.1 DEVELOPMENT TARGET OF PETROVIENAM FINANCE
CORPORATION BY 2015 AND ORIENTATION TO 2025

 PVFC orients to develop in the period

from 2007 to 2011:
 Develop product and service
 Personnel
 Management
 Brand development – marketing solutions

27 Group 6
3.2. DEVELOPMENT ORIENTATION FOR
PVFC THANG LONG BY 2015

 The development routine by 2015 including 3

periods:
• Period of 2007 – 2010: Establish imagine, set up status.
Revenue reaches billions of VND by 2010.
• Period of 2010 -2012: Explore market, become the
branch grade 2 of PVFC, support efficiently in affirming trade
mark PVFC in finance market.
• Period of 2012 -2015: Achieve the target of becoming
one of the heading branches of PVFC with professional and
effective operation; over-fulfill allocated targets and norms

28 Group 6
3.3. OPTIONS IN MARKET DEVELOPMENT
STRATEGY OF PVFC THANG LONG

 Some main reasons to select western

market of Ha Noi
 The place of the head office of PVFC Thang Long lies
in the dynamic area in the West of Hanoi
 Select the market in Ha Noi West area basing on
SWOT model
 Marketing development strategy based on economic
environment
 Brand development strategy

29 Group 6
3.3. OPTIONS IN MARKET DEVELOPMENT
STRATEGY OF PVFC THANG LONG (con.)

SELECTED STRATEGY
 Create values for customers

 Leading banking technology

 Different products/product set

 Focusing on the humance resourse

30 Group 6
3.4. SOLUTIONS

 The solutions for the strategy 1 – The

strategy of the focus
The practical methods possibly coming to real
are:
• Increase income from services.
• Approach the customers who gain high and
stable income, connect them to the effective
invested projects in progress.
• Diversify products, prepare necessary conditions
to control market share of individual finance.
• Focus on develop personnel with higher quality
………………….
31 Group 6
3.4. SOLUTIONS (con.)

 The solutions for strategy 2 – The

strategy of distinction
 All the operations of PVFC Thang Long have
to aim to the distinction from other credit
organizations:
 The products of PVFC Thang Long have to
include three contents:
• “Create values for customers”,
• “Provide sensible values”,
• “Difficult to imitate”.

32 Group 6
3.4. SOLUTIONS (con.)

 Breakthrough solutions
 Some main solutions as follows:
• Increase to perform package products
• Concentrate on investing in projects which are safe and have
high economic efficiency in the industry of petroleum,
energy, high-grade tourism, real estate, banking, stock…;
• Provide consultancy service M&A; take part in this operation
directly;
• Develop high-grade products for VIP customers;
• Develop products and services on the bases of advanced
information technology;
• …………………………

33 Group 6
3.5. SUGGEST SOME SUPPORTING SOLUTIONS

 Toward PVFC
• Support PVFC Thang Long to resolve fully unpaid
debts
• Support the branch with a risk warning system;
• Enhance capacity of management according to
international standard.
• Standardize organizational structure following
international practice, which concentrative aims to
customers.
• Renovate management structure following
international standard.

34 Group 6
CONCLUSION

Within the scale of the thesis with topic, group 6

have resolved following issues:
• Systematize theoretic issues relating to market development
in financial companies and here is PetroVietnam Finance
Corporation – Thang Long branch.
• Analyze the situation of developing products and services,
market; assess the condition of business and take them as
bases to expand Ha Noi Western market.
• Suggest some solutions to enterprises as well as ideas about
policy aiming to develop Ha Noi Western market in the plan
of PVFC Thang Long.

35 Group 6
 Group 6
Gamba
01.X03