The SWOT analysis model is suitable for assessing the current state of the company through analyzing the internal (Strengths and Weaknesses) and external (Opportunities and Threats) situation of the company. SWOT performs filtering of information in an order that is easier to understand and process.
1.3.4.2 Analysis of the evaluation matrix of external factors EFE
EFE Matrix or External Factor Evaluation Matrix – The evaluation matrix synthesizes and summarizes the external factors that are the main opportunities and threats of the external environment affecting the organization and company to make strategic decisions. precision comb. To build this matrix need to go through 5 steps:
– Step 1: Make a list of 10 – 20 opportunity and threat factors that you think have an impact on the success of a business.
– Step 2: Classify the importance of the factors from 0.0 (not important) to 1.0 (very important).
– Step 3: Determine the weight from 1 to 4 for each factor depending on the level of response of each factor, 4 is the best response, 3 is above average response, 2 is average response, 1 is the weak response.
– Step 4: Multiply the importance of each factor by its weight to determine the score of the factors
– Step 5: Add up the scores of all factors to determine the scores of the matrices.
Evaluation: The total score of the matrix does not depend on the number of elements in the matrix, the highest is 4 and the lowest is 1.
– If the total score is 4, the company is responding well to opportunities and threats.
– If the total score is 2.5 the company is responding on average to the opportunities and threats.
– If the total score is 1 , the company is reacting poorly to opportunities and threats .
1.3.4.3 Analysis of the evaluation matrix of internal factors IFE
IFE Matrix or Internal Factor Evaluation Matrix is a model commonly used in strategic management to measure and evaluate internal factors.
To form an IEF matrix, it is necessary to go through 5 steps as follows:
– Step 1: Make a list of 10-20 factors, including the basic strengths and weaknesses that affect the business and the goals that the business has set.
– Step 2: Classify the importance from 0.0 (not important) to 1.0 (very important) for each factor. The importance of these factors depends on how much they influence the success of the business in the industry. The sum of the importance of all factors should be equal to 1.0
– Step 3: Determine the weight for each factor according to the score from 1 to 4, where 4 is very strong, 3 points is quite strong, 2 points is quite weak, 1 point is very weak
– Step 4: Multiply the importance of each factor by its weight to determine the score of the factors.
– Step 5: Add up the scores of all factors, to determine the total score of the matrix
Evaluation: The total score of the matrix ranges from point 1 to point 4, regardless of the number of significant factors in the matrix.
– If the total score is less than 2.5 points, the company is weak on internal factors
– If the total score is over 2.5 points, the company is strong on internal factors.
1.3.4.4 QSPM . matrix analysis
The QSPM matrix is a quantitative strategic planning matrix (QSPM).
The QSPM matrix uses the inputs from the analyzes at the IFE and EFE matrix formation steps to help strategy solvers objectively decide which of the likely alternatives is the strategic one. most attractive and worthy for businesses to pursue in order to successfully realize their goals.
The QSPM matrix development process consists of 6 steps.
– List major external opportunities/threats and important internal strengths/weaknesses in column (1) of the matrix. These factors are taken directly from the EFE and IFE matrices.
– In column (2) of the matrix fill in the numbers corresponding to each element in the classification column of the EFE and IFE matrices.
– Study the SWOT matrices and identify alternative strategies the organization should consider implementing, recording these strategies in the top row of the QSPM matrix. Strategies are grouped separately (if any).
| Important factors (first) | Classification (2) | Possible strategies instead of, replace | The basis of the number of hot spots guide | |||||
| Strategy 1 | Strategy 2 | Strategy 3 | ||||||
| AS | TAS | AS | TAS | AS | TAS | |||
| Internal factors: first. 2. | ||||||||
| External factors: first. 2. | ||||||||
| Total: |
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– Determine the number of attractive points: Very unattractive = 1, less attractive = 2, attractive = 3, quite attractive = 3, very attractive = 4. These values represent the relative attractiveness of each strategy compared to others in the same group of alternative strategies.
– Calculate the total attractiveness score of each strategy individually for each of the key success factors listed in column (1) by multiplying the number of categories by the number of attractiveness points in each row.
– Accumulating the attractiveness scores gives the total attractiveness score of each strategy (taking into account all relevant internal and external factors that may influence strategic decisions). The higher this total score, the more relevant the strategy is and the more worthy it is to be selected for implementation.
In principle, a QSPM matrix can include any number of groups of alternative strategies and within a given group any number of strategies, but only those within the same group. New groups are evaluated against each other.
For example, one group of diversification strategies may include concentric diversification strategies, block diversification strategies, while another group of strategies may include vertically integrated strategies (about forward or backward) and horizontally linked. These groups of strategies are different, and the QSPM matrix only evaluates strategies within the same group.
1.3.4.5. Choose a business strategy.
On the basis of the analysis of the external and internal environments, using the SWOT analysis matrix, using the EFE external factors evaluation matrix, the IFE internal factors evaluation matrix, and the planning matrix. Quantitative strategy QSPM to assess the strengths, weaknesses, opportunities and threats of the bank, thereby choosing a business strategy for VPBank Ha Tinh branch.
CHAPTER 1 SUMMARY
Developing an organization’s development strategy is a long-term plan and orientation, important for the survival and development of any organization in the changing business environment, both challenging, present opportunity as well.
Based on the analysis of the organization’s external and internal environment, managers will develop strategies to promote the strengths, limit the internal weaknesses of the organization, as well as take advantage of opportunities and avoid threats of the external environment in order to achieve the set goals in the best way.
In the following chapters, I will apply the theories of business strategy and how to build a business strategy mentioned in this chapter to build a business development strategy of Vietnam Prosperity Joint Stock Commercial Bank Ha Tinh Branch. until 2020.
CHAPTER 2
ANALYSIS OF BUSINESS STRATEGY FOR VPBANK HA TINH BRANCH
2.1 Overview of VPBank, VPBank Ha Tinh
2.1.1 Overview of VPBank
2.1.1.1. History of establishment and development of VPBank
Vietnam Prosperity Joint Stock Commercial Bank (formerly the Joint Stock Commercial Bank for Non-State Enterprises) was established on 12/8/1993. After 21 years of operation, VPBank has increased its charter capital to VND 6,347 billion, expanding its network to more than 200 transaction points, with a team of over 7,000 employees.
As a member of the group of 12 leading banks in Vietnam (G12), VPBank is gradually affirming the reputation of a dynamic bank with stable financial capacity and responsibility to the community. To achieve its ambitious vision, VPBank has implemented a drastic growth strategy in the current period with the support of the world’s leading consulting firm McKinsey. With this strategy, VPBank strives for organic growth in its target customer segments, urgently builds foundational systems for growth, and actively monitors market opportunities.
VPBank’s outstanding growth is vividly reflected in the expansion of its nationwide network of branches and transaction points along with the diversified development of sales and distribution channels. Besides, following the “All for customers” orientation, the transaction points have been completely changed in terms of appearance, model and service facilities. VPBank’s products and services are always improved and combined with more utilities to increase benefits for customers… All have contributed to satisfying existing customers and attracting more new customers, expanding VPBank’s customer base at a rapid pace.
During the transformation period from 2010 to now, VPBank has focused on finding transformational cores, key staff who are not only rich in knowledge and experience, but more importantly, people who are dedicated and always believe in transforming themselves. believes in the organization’s vision and goals for the coming period, flexible to bring VPBank to the finish line. VPBank recruited many foreign managers to bring new and quintessential elements from developed countries to Vietnam and VPBank. Along with a team of foreign consultants, VPBank currently has 10 foreign employees joining and taking on major responsibilities such as: Board of Directors of Individual Banking Division, Director of Corporate Banking Division, Director of Operations Division, Board of Directors of Risk Management Division, Major Project Management in Information Technology, Cards, Alternative Channels, E-banking… They not only bring to VPBank a wealth of experience working in the banking sector. large multinational organizations such as Citi Bank, ANZ, Standard Chartered Bank, ING Bank, HSBC…but also assigned important missions in training, “technology transfer” and changing management style and work in an open, progressive, and positive way. They are also experts in building banking platforms, processes and controls.
To prepare for stable and sustainable growth, VPBank has carried out synchronous solutions to build the foundation system. The bank has always been a market leader in applying advanced information technology in products, services and operating systems. Along with building a strong and effective corporate culture environment, core human resource management systems have been successfully built and implemented at VPBank. In addition, the Bank has gradually developed an independent, centralized and specialized risk management system that meets international standards and is aligned with the Bank’s business strategy. In parallel with the implementation of international best practices on corporate governance, VPBank has also continuously improved its organizational structure in accordance with a clear and transparent corporate governance policy.
With unremitting efforts, VPBank’s brand has become increasingly strong and confirmed through many prestigious awards such as: Best Payment Bank awarded by Citibank, Bank of New York, Bank Award products with the most satisfied service quality, National brand 2012, strong brand in 2012; 2013 received the Certificate of Merit from the Governor of the State Bank of Vietnam in recognition of outstanding achievements contributing to the completion of banking tasks in 2011-2012, the Most Innovative Retail Banking Award 2013 by Global banking and finance review awarded and received the 2013 Customer Trusted Brand Award by the Ho Chi Minh City Intellectual Property Association and the Saigon Business Network, received the 2013 Typical Brand Award – Typical Brand 2013 by the Research Institute. development of small and medium enterprises, awarded by the Vietnam Business Council Network; Top 500 largest enterprises in Vietnam and many other awards.
2.1.1.2. Vision, mission
VPBank is one of the earliest joint stock commercial banks established in Vietnam, VPBank has made steady progress throughout the bank’s history. Especially since 2010, VPBank has grown tremendously with the development and implementation of a comprehensive transformation strategy with the support of one of the world’s leading strategic consulting firms. According to this strategy, VPBank aims to become one of the top 5 joint stock commercial banks in Vietnam and one of the top 3 retail commercial banks in Vietnam by 2020.
The above vision is realized by a strategy of two main pincers:
– Aggressive organic growth, focusing on individual and corporate segments, while exploiting opportunities in large corporate and consumer credit segments.
– Building solid foundation systems in terms of organization, personnel, technology, operation, etc…
Supporting the implementation of the above strategy is VPBank’s corporate culture, built and cultivated based on 6 core values: Customer is the focus; effective; ambitious; Human Development; trust; and make a difference.
The achievements in the recent transformation period have confirmed VPBank’s correct strategy, with positive changes in image, service quality, professionalism, etc. Customer’s trust for VPBank is also increasingly consolidated with the continuous increase in the number of new customers and mobilized capital. Most especially, VPBank is becoming an address to attract talents in the banking and finance industry. These key factors have been, are and will become strategic weapons of VPBank.