investors. To effectively formulate strategies, it is necessary to identify the financial strengths and weaknesses of the organization. Financial factors often change current strategies and the implementation of plans. The functions of finance include: Ability to raise capital; Financial risk management; Profitability.
Management Activities:
- Planning includes all management activities related to preparing for the future. Specific tasks are forecasting, setting objectives, devising strategies, developing policies, and formulating goals.
- Organizing includes all those managerial activities that create a structure of authority and responsibility relationships. Specific tasks are organizational design, job specialization, job specification, unity of command, coordination, job design, and job analysis.
- Motivation includes efforts to direct human activities, specifically leadership, working groups, changing the way of working, delegating authority, improving the quality of work, changing the organization, employee and management morale...
- Human resources, personnel activities focus on personal management or human resource management, including recruitment, payroll administration, employee benefits, employee safety, equal employment opportunity, labor union relations, disciplinary policies, grievance procedures, and public affairs.
- Controlling involves all management activities aimed at ensuring that actual results are consistent with planned results, such as quality control, financial control, sales, inventory, analysis of changes, ...
Internal Environment Evaluation (IFE) Matrix
The internal factor evaluation matrix allows strategists to summarize and evaluate the major strengths and weaknesses of the functional areas of a business, and it also provides a basis for identifying and evaluating the relationships among these areas. The process of constructing an IFE matrix also involves five steps:
Figure 1.5: IFE matrix construction process
List internal environmental factors
Determine the importance of the factors
Classify factors from 1 to 4
Score each element
Add up the factors on the list
Step 1 : Make a list of the key success factors as identified during the internal factor assessment. This list should include 10 to 20 factors, including both strengths and weaknesses.
Step 2: Assign a weight from 0.0 (not important) to 1.0 (very important) to each factor. This weight indicates the relative importance of the factor to the success of firms in the industry. The sum of the weights should equal 1.0.
Step 3: Rate each factor from 1 to 4, where 1 represents the biggest weakness, 2 is the smallest weakness, 3 is the weakest strength, and 4 is the biggest strength.
Step 4: Multiply the importance of each factor by its rating (= step 2 x step 3) to determine the importance score.
Step 5: Add up the total importance scores for each factor to determine the overall importance score. Regardless of how many factors are in the IFE matrix, the highest total score a company can receive is 4.0, the lowest is 1.0, and the average is 2.5. A total score greater than 2.5 indicates that the company is strong in internal factors, and vice versa if it is less than 2.5.
1.4. Tools for building and choosing strategies
1.4.1. Strengths - weaknesses, opportunities - challenges (SWOT) matrix:
The strengths-weaknesses, opportunities-threats matrix is an important matching tool that can help managers develop the following types of strategies:
- Strengths-opportunities (SO) strategies: these strategies use a business's internal strengths to take advantage of external opportunities.
- Weakness-Opportunity (WO) strategies: WO strategies aim to improve weaknesses.
internal weaknesses by taking advantage of opportunities from the external environment.
- Strength-threat (ST) strategies: These strategies use a business's strengths to avoid or reduce the impact of external threats.
- Weakness-threat strategies (WT): are defensive strategies to reduce internal weaknesses and avoid threats from the external environment.
To build a SWOT matrix, it is important and first of all necessary to identify the main opportunities and threats from the environment, strengths and weaknesses.
core weaknesses. The next step is to combine the strengths, weaknesses, opportunities, and threats into four pairs of strategies SO, WO, ST, WT and record them in the appropriate cells of the SWOT matrix as shown in the following model:
S: Strengths: strengths W: Weaknesses: weaknesses
O: Opportunities: Opportunities T: Threatens: Risks/threats
Table 1.1. SWOT matrix model
Environment
Peripheral
Internal factors
Opportunity (O) O 1, O 2, O 3 ,……………….. List key opportunities outside the business. | Risk (T) T 1, T 2, T 3 ,…………...…… List the major external threats to the business. | |
Strengths (S) S 1 , S 2 , S 3 ,………………... List the strengths within the business. | S+O coordination Use strengths to take advantage of opportunities. | S+T coordination Use your strengths to limit/avoid threats. |
Weakness (W) W 1 , W 2 , W 3 ,…………….. List the weaknesses within the business | W+O coordination Exploit opportunities to fill weaknesses. Overcome weaknesses to take advantage of opportunities | W+T coordination Overcome weaknesses to reduce risk |
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The process of building a strategy is a process that includes analyzing the internal and external environmental factors of the enterprise based on the mission and business objectives set out by the enterprise to draft and select appropriate strategies. To build strategies, it is necessary to evaluate whether the enterprise has implemented the right measures or not, and whether the current activities of the enterprise can be carried out more effectively or not. Regular re-evaluation of strategies will help strategic managers avoid complacency and subjectivity. Objectives and strategies need to be regularly concerned, developed and combined to complete the mission of the enterprise with the highest efficiency.
The purpose of the SWOT matrix is to develop viable alternative strategies, not to decide which strategy is best. Therefore, among the development strategies in the SWOT matrix, only a few strategies are selected.
1.4.2. Quantitative Strategic Planning Matrix (QSPM)
The SWOT matrix presents alternative viable strategies and the QSPM matrix is a tool to help decide which strategy is best for the business. The QSPM matrix uses the inputs from the analysis of the EFE, IFE matrices and the combined results of the SWOT matrix analysis to objectively decide among the best alternative strategies. To develop a QSPM matrix, there are six steps as follows:
Step 1 : List the key external opportunities/threats and weaknesses/
internal strengths of the business
Step 2: Give each critical success factor a classification, internal and external. This classification is the same as in the IFE and EFE matrices.
Step 3: Identify alternative strategies that the company should consider implementing.
Group strategies into separate groups if possible.
Step 4: Determine the attractiveness score of each strategy (AS). The attractiveness score represents the relative attractiveness of each strategy compared to other strategies. Only strategies in the same group are compared with each other. The attractiveness score is classified as follows: 1 = not attractive, 2 = somewhat attractive, 3 = quite attractive, 4 = very attractive. If the success factor does not affect the choice of strategy, do not assign an attractiveness score to the strategies in this group.
Step 5: Calculate the total attractiveness score (TAS), which is the result of multiplying the classification score (step 2) by the attractiveness score (step 4) in each row.
Step 6: Calculate the total attractiveness score for each strategy. This is the sum of the total attractiveness scores in the strategy column, with higher scores indicating more attractive strategies.
Chapter 1 Conclusion:
The above is the entire theoretical basis of general nature that can be applied to the strategic management process in enterprises. However, each different enterprise will apply it with different aspects according to the actual situation of that enterprise. The construction of business strategy for tourism products at Ky Nghi Viet Company in the period of 2012 - 2016 will thoroughly apply that theoretical basis.
CHAPTER 2: BUSINESS ENVIRONMENT AND OPERATING SITUATION
WORKING AT VIET VACATION TRAVEL COMPANY
2.1. General introduction about Ky Nghi Viet travel company
2.1.1. General introduction about Ky Nghi Viet travel company
- Ky Nghi Viet Travel Company was established in 1994 with a team of professional staff in organizing and operating tourism.
- Company name: Ky Nghi Viet Travel Company
- English name: Viet Holidays
- Transaction office: 607C My Thuan luxury apartment, An Duong street
King, Ho Chi Minh City
- Phone: +84 0822290588
- Fax: +84 62606335
- Email : info@holidaysvn.com
- Website: http://www.tovietnamholidays.com
- Representative: Mai Nam - Phone number: 0933 969 617
2.1.2. Business lines
Viet Holiday Travel Company operates in many fields: restaurants
-hotel, tourism, intermediary services.
The company operates mainly in two areas: travel and tourism (domestic tours)
local, Inbound and Outbound) and intermediary services (air tickets, accommodation, visa, ...)
2.1.3. Mission, image, values and commitments of Ky Nghi Viet Travel Company
Currently, the main task of the enterprise is to establish business strategies and service types suitable to the increasingly diverse needs of customers.
Comply with and implement well the state's policies and regulations for the tourism industry.
Business activities always aim at the benefit of customers, always creating
conditions for employees to develop long term, ensuring employees' lives.
The company always tries to achieve its target values in terms of image, value and commitment:
Image: Contribute to the construction and development of the domestic tourism industry. Create ideal tourist destinations and contribute to the development of national tourism.
Value: For businesses, people are important. They are the factor that helps businesses succeed. Preserve natural landscapes and build ecological balance. Customers are kings, they are the ones who bring profits to businesses.
Commitment: With the motto "Prestige and quality are the decisive factors for success", the enterprise commits to:
- Always put reputation first in business;
- Strive to minimize costs to offer appropriate prices to bring many benefits to customers;
- Will create a clean production environment, no pollution and avoid risks, safe labor.
- Prestige, quality and attentive service style will bring added value to customers.
2.1.4. Organizational structure of Ky Nghi Viet travel company
Diagram 2.1: Organizational chart of Ky Nghi Viet travel company
Supervisor: MSc. Ngo Ngoc Cuong
SVTH: Nguyen Thi Hang Nga
Organizational chart of Vietnam holiday travel company
BOARD OF DIRECTORS
GENERAL PARTS
TOURISM SERVICES DEPARTMENT
BUSINESS DEPARTMENT
SUPPORT DEPARTMENT
Human Resources Department
FINANCE AND ACCOUNTING DEPARTMENT
TOUR DESIGN DEPARTMENT
TOUR OPERATIONS DEPARTMENT
IN BOUND
OUT BOUND
INTERNAL
LAND
INFORMATION TECHNOLOGY
TOUR GUIDE
Fleet
Graduation thesis
Page | 21
(Source: Administration - Human Resources Department of Ky Nghi Viet travel company)
Functions and duties of the departments:
Board of Directors: consists of 3 people, with university degrees, including 1 Director and 2 Deputy Directors. Responsible for all aspects of the Company, directly managing department heads, and delegating authority to department heads when necessary. Directly managing and planning operations. Responsible for foreign affairs and being the main spokesperson of the company.
Finance and accounting department: consists of 5 people, including: 1 accounting manager, 1 deputy manager and 3 accountants, responsible for business accounting for all activities of the company according to the current financial regime. Make financial plans, salary accounting, manage and control resources and assets. Monitor, record and report data fully, accurately and promptly. At the same time, advise the director in making decisions on finance and business strategy.
Administrative - human resources department: consists of 7 people, performing administrative work, organizing meetings, conferences, arranging guest schedules, work for the director and deputy director... Advising the director on human resources work and staff training.
Tour Operations Department: consists of 2 people, responsible for supervising operations and checking the quality, standards, and safety of tours that are being and will be implemented. At the same time, record customer feedback through tour guides and drivers of each specific tour.
Tour Design Department: consists of 5 people: 1 design manager, responsible for reviewing the program, then submitting it to the Board of Directors to implement the tour program, 2 people in charge of researching, developing and writing domestic tours, 2 people in charge of researching, developing and writing international tours.
Outbound Department: consists of 4 people: 2 online sales in charge of selling inbound tours via the Internet, 2 Sales Administrators performing sales operations at the office. Organize design, sale and implementation of overseas travel programs for Vietnamese customers, foreign customers in Vietnam who want to travel abroad.
Inbound Department: consists of 5 people: 2 online sales in charge of selling inbound tours via the Internet; 2 sales Executive in charge of direct sales to visit and find customers, 1 sales Administrator performing sales tasks at the office. Organize design, sale and implementation of tourism programs for customers who are foreigners, overseas Vietnamese outside of Vietnam who want to travel to Vietnam.