Improving the effectiveness of Can Tho Insurance Company's business strategy - 1

SWOT can provide a harmonious connection between pairs or between 4 factors. This helps businesses form their strategies effectively to best exploit opportunities from the outside, reduce or avoid threats, on the basis of promoting strengths and overcoming weaknesses. The relationship between SWOT is shown in the following diagram:

SO S (Strengths): strengths W (Weaknesses): weaknesses

WT O (Opportunities): opportunities T (Threats): threats

Circumspect

FS

+6

+5

+4

+3

+2

+1

Attack

CA –6 –5 –4 –3 –2 –1 0 +1 +2 +3 +4 +5 +6 IS

-1

-2

Defense

-3

-4

-5

-6

ES

Compete

 Analysis method using QSPM Matrix (Quantitative Strategic Planning Matrix): This analysis technique will objectively show which alternative strategies are the best. QSPM matrix uses input factors from the analysis of EFE matrix, competitive image matrix, IFE matrix. And then receives the necessary information to establish QSPM matrix from SWOT matrix, SPACE matrix,...

IV. Scope of research:

This topic is only researched within the scope of one enterprise. Specifically, the research is based on data and practical situation of the old Can Tho insurance company, because when this report was completed, this company had split into two companies: one located in Can Tho city and one located in Hau Giang province. Therefore, the results of the solutions given in this topic are only mentioned for the insurance company in Can Tho city.

CONTENT SECTION

I. Theoretical basis:

1.1 What is strategic business management?

1.1.1 Overview of management :

Management is a process to achieve success in the set goals by effectively coordinating the resources of the enterprise. From this concept, we see that management is a continuous and necessary activity for the existence and development of every organization.

The goal of management is to create surplus value, that is, to find the appropriate way to perform work to achieve the highest efficiency with the best cost of resources. Therefore, it can be said that the reason for the existence of management activities is the desire for efficiency, and only when people are interested in efficiency, then they are interested in management activities.

Or in other words: management in an enterprise is the process of planning, organizing, coordinating and adjusting the activities of members, departments and functions in the enterprise to maximize the mobilization of all resources to achieve the set goals of the organization. Therefore, management has 4 basic functions: planning, organizing, leading (controlling), and monitoring in the business process. And their close relationship is shown in the following diagram:

PLANNING

Set goals and decide the best way to achieve them

CONTROL

Check and evaluate activities to achieve goals

ORGANIZATION

Determine allocation and arrangement of resources

LEADER

Influence others to work towards organizational goals

In addition, the decision making process must go through the following steps:

 Step 1 : Analyze the problem specifically, find out the true nature of the problem.

 Step 2 : Develop possible and probable scenarios.

 Step 3 : Compare and choose the most feasible option.

 Step 4 : Choose the optimal solution.

 Step 5 : Implement the selected option.

 Step 6 : Evaluate implementation results.

1.1.2. Concept of strategy:

Strategy is a set of goals and policies set for a long period of time based on maximizing the organization's resources to achieve development goals. Therefore, strategy needs to be set as a general plan or operating diagram that guides the company to achieve the desired goals.

Therefore, the proposed strategy must simultaneously satisfy the following elements:

 Strategy must be outlined over a relatively long period of time.

 Strategy must create growth for the organization.

 Strategy must maximize resources and make reasonable use of existing resources.

 Strategy must create the best competitive position.

After setting out an appropriate strategy, we must transform the strategy into policies and action programs through an effective organizational structure to achieve the set goals. The characteristics of strategy implementation are:

 All managers are participants in implementing strategies within the scope of their authority and responsibility, while executors are those who participate under the command of managers.

 The strategy implementation process is considered successful when the business achieves its goals and demonstrates clear progress in creating advantages or strengths over competitors, compared to the implementation of the set mission.

 Strategy implementation is a process that combines the science and art of management.

1.1.3. Concept of business:

According to Article 9 of the Law on Enterprises of our country issued on February 2, 1991, "Business is the implementation of all stages of the investment process from production to consumption of products or provision of services on the market for the purpose of making a profit". Thus, it can be understood that: Business is the activities aimed at making a profit of business entities on the market.

1.1.4 Business strategy management:

Strategic business management is the process in which managers determine long-term goals and propose major directional measures to achieve those goals based on maximum use of existing resources and resources that can be mobilized by the business.

Specifically, strategic management is the process of studying current and future environments, planning the company's goals; making, implementing and controlling the implementation of decisions to achieve those goals in the current and future environments.

The purpose of a strategy is to seek opportunities, or in other words, to increase opportunities and to rise to find a competitive position. Therefore, strategic management is a process consisting of three main stages:

 Planning and strategy development phase.

 Strategy implementation phase.

 Strategic control phase.

To create a harmonious and effective strategy, it is necessary to consider factors that can affect the strategy such as: the strengths and weaknesses of the business, opportunities and risks in the external environment, the goals and tasks of the business, etc.