IT DEVELOPMENT STRATEGY FOR SUFAT VIETNAM CORPORATION PERIOD 2013 2018

Paris Graduate School of Management

Thai Nguyen University

INTERNATIONAL EXECUTIVE
MASTER OF BUSINESS ADMINISTRATION PROGRAM

THESIS TITLE:

IT DEVELOPMENT STRATEGY FOR SUFAT VIETNAM
CORPORATION PERIOD
2013-2018

Student name:

TRIEU QUANG MINH

Intake I

2012


MỤC LỤC

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INTRODUCTION...................................................................................................4
CHAPTER I: THEORETIC BASIS.........................................................................6
I. THE CONCEPTS, ROLES OF BUSINESS STRATEGY ....................................6
1. Business strategy of the enterprise. ..................................................................6
2 .The roles of business strategy...........................................................................8

3. Factors affect the building of strategy ..............................................................9
II. Information management and information technology ......................................15
1. Theory of information management system and information technology .......15
1.1. Theory of information management......................................................... 15
1.2. Overview of Information Technology......................................................17
2. The roles of Information management and Information..................................19
Technology for the company management activities. ............................................19
3. Strategic options for information technology applications .............................. 21
III. Vietnam Local Businesses’ experiences in this area.........................................22
1. Valuable experiences that Vietnam enterprises should learn........................... 23
2. The application of IT in business ...................................................................23
4 - Challenges for CIOs in Vietnamese enterprises ............................................25

CHAPTER II: ANALYSIS OF BUSINESS ENVIRONMENT AND
INFORMATION TECHNOLOGY IN SUFAT VIETNAM CORPORATION ......26
1. Enterprise overview ........................................................................................... 26
2. External environmental analysis.....................................................................27
2.1 Macro environment (PEST model) ........................................................... 27
2.2 Business environment (5 forces) ............................................................... 30
2.3 Analysis of enterprise’s inside ..................................................................32
3. IT Status at SUFAT VIETNAM.....................................................................44
3.1 Information and Administration................................................................ 44
3.2. Property relationship between IT and Business. .......................................46
3.3. Human assets........................................................................................... 50

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3.4. Summary of SWOT analysis ...................................................................52
CHAPTER III: RECOMMENDED STRATEGY ..................................................55
I. Vision and Mission ............................................................................................ 55
II. Strategy recommendation for Sufat ...................................................................56
III. Implementation (Solutions) .............................................................................57
1. IT solution .....................................................................................................57
2. Detailed Action Plan ......................................................................................73
3. Plan for implementing the IT strategy ............................................................ 77
CONCLUSION .....................................................................................................81

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INTRODUCTION
Nowadays, information technology (IT) becomes one of the best solutions to
manage the enterprise. The suitable IT applications help transfer information in the
enterprise quickly and more precisely: production manager knows the daily output
of the enterprise to compare with the proposed plan, the chief financial officer
knows the cash and debt situation of the day without waiting for monthly report,
HR manager seizes the work situation of employees to have flexible plan of
personnel mobilization to serve objectives, production plan, and executive director
finally seizes all those above things whenever he wants. This helps executive
director seizes the operation situation of the company in anytime and anywhere, and
simultaneously make the timely adjustment as soon as new issues arose. However,
the enterprise needs to know a reasonable, affordable investment for technology
solution packages promote the most effective in their admissible conditions. The

requirement of effective IT system (including machines and application software)
and parts in the system must be compatible with each other as well as be able to
transmit information quickly. Especially in the motorcycle industry where IT is
increasingly playing an important part and applied in all processes from production
management, marketing, finance to expansion of business operations abroad and
product designs based on requirement of customers

For Sufat Company – a motorcycle manufacture in the country, are suffering fierce
competition from big Japanese manufacturers. When planning IT strategy for Sufat,
the following questions need to be made and answered:
- Is the motorcycle business industry of Sufat received effective support from IT?
- Can the company significantly improve when redirecting use resources and
applying IT?
- How doesSufat improve the relationship of exchange information between other
departments?
- What IT orientation will Sufat follow to match the company potential while still
ensuring effective competition?
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Because of the above reasons, the research of IT factual situation in Sufat, the

application of IT deployment experiences from other countries in the world, since
then making the plan to build strategic development of IT for Sufat in period 2013
– 2018 are really essential.

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CHAPTER I: THEORETIC BASIS
I. THE CONCEPTS, ROLES OF BUSINESS STRATEGY
1. Business strategy of the enterprise.
a. Concept of business strategy:
According to the traditional approach, business strategy is considered as a long-term
overall of an organization in order to achieve long-term objectives. The researcher
of management history, Alfred D. Chandler said that “strategy is the determination
of basic long-term objectives of an enterprise and the operation program with
allocation of the necessary resources to achieve those objectives”. As such, his
ideologies expressed clearly that strategy is a planning process with wisdom, in that
the enterprise chooses their own objectives, determines the operation program to
complete best these objectives and seeks to allocate corresponding resources. The
traditional approach has the advantage that makes the enterprise easily imagine the
necessary work to plan strategy and see the benefits of strategy with aspect of longterm plan. However, in the nowadays volatile business environment it shows the
limitations of the traditional approach because it isn’t able to adapt flexibly to
changes of business environment.
Under the current approach, strategy may be larger than what the enterprise intends
or plans to implement. According to Mintzberg’s opinions, he thought that strategy
is a model in the flows of decisions and action programs. The model can be any
type of strategies: the pre-designed strategy or mutant strategy.
The modern approach helps the enterprise easily responds flexibly to the changes of
business environment and promote the creativity of the members of the enterprise.
However, it requires the leaders, manager must have qualification, ability to predict
the conditions for strategy implementation and evaluate the value of mutant
strategies.

Through the above approach, we can understand: the business strategy of an
enterprise is an art of building long-term objectives and implementation policies in
order to orient and create competitive advantage of the enterprise.

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Characteristics of business strategy of an enterprise:

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- Long-term orientation: Business strategy set objectives and determines the
development direction of the enterprise in long-term period (3 years, 5 years, 10
years) in order to orient operation for the enterprise in a business environment.
- Objective: business strategy often determines clearly the basic objectives. The
business orientation of each enterprise in each period and policies in order to
implement correctly the objectives set out.
- Relevance: this requires enterprises when building business strategy need to
evaluate correctly the factual situation of their business activities. At the same time
they must regularly review and adjust to be suitable for environmental changes.
- Continuity: business strategy must be reflected during process continuously from
the elaboration, implementation, inspection and evaluation to strategic adjustment.
- Business strategy in current conditions cannot be separated from the competition
because business strategy ensures competitiveness of the enterprise in the market. In
the current globalization process, the business operations are connected all over the
world creating the influence and interdependence. Since then it creates fierce
competition among enterprises in the industry as well as the industry in the
economy.
b. Classification of business strategy in the enterprise:

Depending on the different classification criteria we have different types of business
strategy.
* Based on the practice of business strategy:
- The expected business strategy: is the overall combination of the objectives,
policies and action plans in order to reach the expected objectives of the enterprise.
This strategy is made to demonstrate the will and long-term action plans of an
enterprise made by the leaders, managers.
- Realistic business strategy is the expected business strategy adjusted to fit the
business environment factors taking place on actual when implementing. The
expected business strategy will become realistic business strategy when conditions
and actual circumstances in strategy implementation have ability suitable for

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conditions and circumstances have been taken into account in the expected business
strategy.
* Based on the level of business strategy:

- Enterprise-level business strategy: is the overall business strategy in order to orient
the enterprise operation and the allocation method of resources to achieve the
general objectives of the enterprise.
- Business unit – level business strategy: aim to build competitive advantage and
implementation method in order to locate the enterprise in the market.
- Function - level business strategies: is the strategies related to particular activities
of the enterprise in order to support enterprise-level business strategy and business
unit – level business strategy.

* Based on the implementation scale of the business strategy:
- Domestic business strategies: are the long-term objectives and particular action
plans of the enterprise in order to develop their operation in the domestic market.
- International business strategies: are the overall objectives in order to create
competitive position of the enterprise in the international market.
* Based on the importance of the business strategy:
- Mixed business strategy includes: horizontal mixing, vertical mixing.
- In-depth business strategy: market penetration, market development, product
development.
- Expansive business strategy: concentric diversification, horizontal diversification,
mixed diversification of activities.
- Specific business strategy: Joint venture, linking, narrowing operation, liquidation.
2 .The roles of business strategy
Business strategy plays an important role for the existence and development of each
enterprise. The right business strategy will create a good direction for the enterprise,
business strategy can be considered as the Lodestar leading the enterprise in the
right direction.
In fact, there are many enterprises thanks to the proper business strategy that
achieve successes, overcome competitors and create its position in the market.
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Business strategy provides many benefits to the enterprise, the importance of it
shown in the following aspects:

- Business strategy helps the enterprise orient its activities in the future through
analysis and prediction of business environment. Business is an activity that is

always under the influence of the external and internal factors. Business strategy
helps the enterprise has both flexibility and initiative to adapt to the market changes,
at the same time ensure that the enterprise operates and develops in the right
direction. It can help the enterprise strive to implement objective of improving its
position in the market.
- Business strategy helps the enterprise seizes opportunities as well as fulfilled risks
for the resource development of the enterprise. It helps the enterprise exploits and
use reasonably the resources, promote the strength of the enterprise.
- The strategy creates an orbit operation for the enterprise, helps the enterprise to
link individuals with the other benefits together towards a common purpose,
develop the enterprise. It creates a closed link among employees and between
managers with employees. Thereby to strengthen and enhance furthermore the
internal force of the enterprise.
- Business strategy is the effective competitive tool of the enterprise. In the current
conditions of globalization and economic integration, create the influence and
mutually dependent among enterprises. The process has created fierce competition
among enterprises in the market. In addition to competitive factors such as: price,
quality, advertising, marketing, enterprises also use business strategy as an effective
competitive tool.
3. Factors affect the building of strategy
If want to build its suitable strategy, the enterprise should pay attention to analyze
influence factors, they divide them into the following group:
- Group of factors in macro environment.
- Group of factors in industry environment.
- Evaluation of internal enterprise.
a) Analysis of macro environment:
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Macro environment is the overall factors outside the enterprise, has influence on the
demands of the industry and affects directly benefits of the enterprise.

It includes factors: growth rate of the economy, interest rate, inflation, exchange
rate, unemployment rate and policy of finance-monetary, etc.
The factors of economic environment can provide opportunities or challenges to the
operation of an enterprise.
If the economy grows at a high speed, it will impact the income increase of the
segments of the population leading to increase payment ability for the demands.
This leads to the diversification of demands and aggregate demand of the economy
tend to increase. In addition, the growth rate of the high economy, the enterprise has
ability to increase productivity and business efficiency items, has ability to scale up
and increase accumulate capital. This increases demands of the large enterprise to
make the business environment more attractive.
- The factors of the law and the state management:
The factors of the law and the state management also affect the conveniences and
difficulties of the environment. The creation of a healthy business environment or
not isn’t entirely dependent on the factors of the law and the state management of
economy.
The promulgation of legal system put into life and the good operation quality of
state management agencies in economy is the condition to ensure the fair business
environment, facilitate the enterprise to have healthy competitive opportunities and
vice versa.
In addition to understand and comply with the policies and laws of the state, the
enterprise has healthy competitive opportunities and vice versa.
- The factors of technique-technology.
In the current trend of economic globalization, the rapid development of all fields of
technique-technology, especially information technology affects directly business

activities of all relevant enterprises. The development of technique-technology
makes the product life cycle tends to increasingly shorter. Thus, the good research,
understand and application of technology are the prerequisite to enhance the
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technology promotes business operation of the enterprise to develop by increasing
the speed, ensure the sustainable stability in business operation and environmental
protection. However, when researching to apply science and technology, the

enterprise needs to pay attention to the trend of its impacts on the industries and
enterprises are different so should analyze carefully its direct impacts on the
business operation of the enterprise.
- The factors of culture-society: culture-society affects slowly but also profoundly
to the business operation of every enterprise. These factors strong impact on the
demand in the market.
In addition, culture-society also affects directly the formation of cultural enterprise
environment. Thus, the enterprise needs to understand clearly about the sociocultural environment that they are operating.
- Natural factors:
The natural factors include: natural resources, geographical conditions, ect affecting
the input resources for the production and output product consumption issues of the
enterprise.
The natural conditions affect in different level, different intensity with each
enterprise in different locations and it affects the enterprise in both trends: positive
and negative. Therefore, the research and understand of the characteristics of
natural factors will help the enterprise to be more proactive in making their
production and business plans.

b) Analysis of industry environment:
The industry environment includes factors in the industry or external factors. These
factors determine the nature and the extent of competition in the industry.
According to Michael E. Porter, the core problem when analyzing the industry
environment including:
- The extent of competition among the enterprises operating in the industry.
- Competitiveness of the potential competitors.
- The extent of competition of alternative products.
- The pressure of customers.
- The pressure of suppliers.
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The impact intensity of these five factors often changes over time and in different

extent. Each impact of one of these above factors also affects directly the survival
and development of the enterprise. Analysis, monitoring and fully grasp these above
factors help the enterprises identify the opportunities and challenges in order to
offer the appropriate strategy.
c) Evaluation of internal enterprise:
The evaluation of internal enterprise is the analysis of the current factual situation
of the enterprise resources in order to see clearly strengths, weaknesses of the
enterprise. Since then, the enterprise can use up and promote the strengths and seek
to overcome the weaknesses of the enterprise. When analyzing the factual situation
of the enterprise, we go into the analysis: financial operation, production situation,
human resource, marketing, research and development, organizational structure, etc.

Analyzing the enterprise model based on the model 4Ps (marketing mix):

Product: Manage factors of products/ services (brand, functions, qualities, forms,
packaging, enclosed services, warranty, etc.) and making development plans of
products/ services to the market.
Price: Determine price of the products except the cost of production, management
also to other factors (the current price of competing products, promotion prices,

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prices for the dealers, applied prices for other payment forms, etc.) to determine the
list price for the products.
Place: Select and manage the commercial channels to the products occupy the target
market at the right time and develop the logistics systems (logistics), and ship
products.
Promotion: Introduce and convince the potential market to use the products of the
enterprise through various types of business promotion (advertising, personal
selling, public relations, journalism or Internet, etc.)
* The reason why 4Ps still exist in nearly half of a century because it covers all the
factors of a marketing strategy the most simply but is still relatively fullfil. Of
course 4Ps now is defined more broadly than the beginning to more suitable for the
times.
A marketing strategy built on 4Ps frame will start from product policies. This is a
reasonable thing because the most essential of an enterprise is to have a product or
service to put in the market. After having the product, the managers will begin

calculating the price policies. The price policies may affect the distribution system
of the product.
Finally, after determining the product distribution policy, the managers will
determine the types of advertisement to promote the sale of products. All the above
policies are built aiming at the target market (refer to 4Ps combination chart in
marketing strategy).
In theory, if the enterprise can perform any of a P element in 4Ps better than
competitors, the enterprise will have competitive advantages – the sign of a
successful marketing strategy – preferred by customers and becomes more
successful.
Enterprise-oriented analysis according to SWOT model

Strengths

Weaknesses

- Control and sales orientation

- No test the list of consumer objects yet

- Right product, quality and reliability

- Have holes in several market areas.

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-Produce products more superior to - The company is a small enterprise
competitors

- Having no direct marketing

- The reliability of product is better

experiences

- Experiences of employees

- Unable to provide for foreigner

- Have list of consumers

customers

- Have ability to communicate directly

- Need more sales staffs

- Conducting the product innovation

- Funds limited

- Can to serve in places

- No implementation of pilot projects

- The products have been recognized

- Have no blueprint

- Trust in this new activity

- Delivery staffs need to be trained more
- No estimation of probable situations

Opportunities

Risks

- Can develop the new products

- The impact of the law

- Quality of competitors are poor

- The impacts from the environment can

- Profit margins will be high

create advantages for competitors

- Can expand abroad

- Create the risks to business operations

- Use the new experts

- Seasonal market demands

- Can cause surprise to the competitors

- Need to maintain the key employees

- Support the major business operations

- Can be distracted from the main

- Can find the more profitable contracts

business
- Can meet the negative reactions from
the public
- Vulnerable by big competitors

SWOT analysis model is applied in the evaluation of a business unit, a proposal or
an idea. It is a subjective evaluation of the data organized in a logical sequence to
help us understand the problem, since then we can discuss and make decision the
most reasonable and accurate.
Based on the specific context, a SWOT analysis model can provide one or a few
items in list of 6 action steps:

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+ Products (What are we going to sell?)

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+ Processes (How do we sell?)
+ Customers (Who do we sell to?)
+ Distribution (How can we approach the customers?)
+ Finance (How much are price, cost, and investment?)
+ Management (How do we manage all those activities?)
In any case, SWOT basically tells us what is “good” and “bad” in the current
business or for a new proposal for the future. If the analysis object of SWOT is
business, the analysis objective is to improve the enterprise so SWOT will be
interpreted as the following:
“Strengths” (Maintenance, development and being a lever) “Opportunities” (The
positive evaluation) “Weaknesses” (The remedy to repair or to get rid of
weaknesses) “Risks” (Challenges).

II. Information management and information technology
1. Theory of information management system and information technology
1.1. Theory of information management
Concept of information management system
As defined at Encyclopedia “The information management system is the system
provides information to the management of the organization. It includes human,
equipments and processes to collect, analyze, evaluate and distribute the necessary
information timely, accurately for the editors of decisions in the organization.
According to Master Nguyen Anh Hao’s aggregate from the researches in the book
Management Information Systems. Kenneth C.Laudon, Jane P.Laudon, Prentice
Hall, 2002, then,
“The information management system is a machine that transforms data (and
information) collected into useful information for the manager perform their roles
(organizational management)”
Information system may include specific information and especially about a person,

different locations, events inside a organization or in an environment around that.
Classification of information management system
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The information management system can be classified according to the applicationlevel, the service purposes of output information. Because of the relevance of the
subject, this assignment will only classify according to the application-level.
According to application-level, the enterprise is divided into 4 levels: strategy,
tactics, expert and operation

Operation-level information system: support the low management levels such as
leaders, divisional director, etc. in monitoring the activities and basic transactions of
the enterprise such as sale, invoice, cash, salary, approval, loan, material flow in the
factory. The main purpose of this system is to answer common questions and
monitor the transaction capacity in the enterprise.
Expert-level information system: provide knowledge and data for the researchers in
an organization. The purpose of this system is to help enterprises develop the new
knowledge, design products, distribute information and handle the daily work in the
enterprise.
Tactics-level information system: designed to support, control, make decisions and
implement the activities of the intermediate-level managers. The importance is the
system needs to help the managers to evaluate the work status whether in good
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condition or not. At this level, the information provided through monthly, annual
and quarterly reports, etc.

Strategy-level information system: helps the senior managers to process and
propose the strategic direction as well as long-term development trends. The
objective of information system is to help the enterprise has the best adaptability to
changes in the environment. The questions are similar: How many workers does
the enterprise need to recruit in the next 5 years? What will the trends of raw
material price be in long-term and what cost can the company bear? What products
should produce in the next 5 years?
1.2. Overview of Information Technology
Concept of Information Technology
For nearly a half of millennium ago, people could not imagine that the word
“computer” could be use d to describe an apparatus with ability to calculate and
process data as fast as lightning. The word “computer” first appeared in 1963 and
was a noun indicating the people with ability to do calculations. The long
development history with the continuous evolution from the beginning of the 19 th
century to 1950, the computer processing the first data storage was completed.
Since then, computer develops rapidly, attached to it is the emergence of the
concept of Information Technology.
In the world, the term “Information Technology” appeared in 1958, but in Vietnam,
because the emergency of computers was slower than other countries, the
Information Technology concept just given in the Government Resolution No.
49/CP signed on 04/08/1993: " Information Technology is a collection of scientific
methods, the modern means and technical tools – mainly is computer techniques
and telecommunication in order to exploit and use effectively the plentiful and
potential information resources in all areas of human and society activities"
Therefore, Information Technology includes all activities and technologies contain
the contents of information processing by electronic means, from the collection,

storage, search, processing, transmission, etc. to use the information in all areas of
production, economy and human life. With the rapidly magical progress of
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computer techniques and telecommunication techniques in recent decades,
Information Technology really has widely penetrated into all aspects of human
activities, leads to large changes in automation of production process, improve
quality of available products and services, creates many new products and services,
promotes the innovation processes of organizations and economic management,
restructures the economy, etc.
The development process of Information Technology
The development of Information Technology has made many fields converge to
each other. The capabilities of computers are increasingly strong, the utilities are

increasingly more, the size is increasingly small, the use is increasingly simpler,
computers are applied more and more widely in all fields, all times and all places.
The development process of Information Technology can be divided into 4 stages:
The first stage (manual): the collection of information and information processing
is performed mainly by the manual methods.
The second stage (mechanization): Use computers to participate in some stages in
the process of collecting and processing information such as calculation, analysis,
statistic, collecting information.
The third stage (automation): the entire process of collecting information and
processing information is automated on the basis of using the powerful computer
systems. Thanks to automation, large amount of information is analyzed, processed
much faster. Before, in the laboratory the experiments must have person to monitor,

record and carry out many times to get many data sequences, then calculate, analyze
to find out the relationships, and since then have the scientific conclusion.
Nowadays, those works are mostly automated. The experimental data is measured,
recorded, store automatically by machines and then put in the computer to
automatically process and the result is due to the general collecting information,
relationships, viable solutions, etc. can lead to the new discoveries, new knowledge.
Similarly in scientific research, in daily life, the massive volumes of commercial
information, information of economy, culture and society, etc. also processed on a
computer to give people a lot of new knowledge, suggest new methods, new
thinking
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The forth stage (intelligent information): The computer system has accumulates a

very large volume of information and knowledge, very larger abilities to process,
helps people to analyze situations, pick out the solution, efficiently help people to
enhance knowledge, develop the creativeness abilities and the intelligence of
human. For example, Deep Blue computer manufactured by IBM firm, thanks to
accumulation of information and experiences of experts in the field of chess can
win the world chess champion Casparop. If the mechanical technology helps people
improve physical labor capacity, increase enforcement, the Information Technology
helps people enhance intellectual capacity, increase the mental power.
2. The roles of Information management and Information Technology for the
company management activities.
In recent years, the role of information system in the enterprise is increasingly
stronger, from just being used to support some activities in the office information

system have became a strategic role in the enterprise. Especially the achievement in
Information Technology and their application in many businesses made the
enterprise increasingly interested in the application of IT in the business and
production processes. Although an information management system doesn’t
necessarily have to use IT, but IT (hardware and software) are increasing cheap and
contribute to make the capacity of processing, storage, information distribution is
increasingly high, so the modern information management system often positively
use information technology.
This writing will summarize some of the basic roles of information management
and IT in the company management activities.
Unlike the period of the 1950s, when the enterprise mainly use the information
system to reduce the costs for regular work, nowadays, the information system can
play a strategic role in the organization. The enterprise uses information system in
all management levels in the enterprise. Not only play a role as the providers report
continuously and accurately, information system have really become a strategic
tool, weapon for enterprises get the competitive advantage in the market and
maintain the existing strengths.

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Information Technology helps the management process become more effective.
Through that the enterprise has the ability to cut costs, increase the quality of
products, and complete the distribution process of products and services of it.
Nowadays, many factories manufacture automobiles have used the production
technology with the support of computers to control the production process and

check the product quality. The distribution of automobiles and spare parts, as well
as the payment of customers and the sales information or the financial situations
among the different areas also use telecommunication network. Thanks that method,
the enterprise has operated much more effectively and at the same time reduce the
cost in the possible maximum. In general, the method of using information system
in management is suitable for the enterprise has strategy to reduce costs.
To help the enterprise have the competitive advantage by building closed
relationships with the buyers, and the material supplier. Almost telecom
companies are very focused on this activity. They encourage customers through the
sales and provision of information as fast as possible.
Encourage creative activities in the enterprise: That is the process of developing
new products, new services and new production process or activity in the enterprise.
This can create the business opportunities or new market for the enterprise.
Create conversion costs in the relationship between the enterprise with
customers or suppliers. This means that customers or suppliers are closely tied to
the technological changes inside the enterprise, and they will have to bear
significant costs in term of time, money, and inconvenience if they switch over to
use or supply products for another enterprise. The airlines invest in building their
information system perfectly to help their automatic ticket booking system and it is
a manifestation of investment in information system has brought competitive
advantages for these firms.
Investing in Information Technology also has ability to create some new
activity types of the enterprise.
- Virtual Organization: These organizations of this type don’t actually exist in the
physical form. They are formed based on the agreement among the different
partners. A group of individuals will use the bulletin board on the computer to
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communicate and exchange ideas with each other. This type of activity usually

exists in the scientific organizations. The members can organize the periodic
conferences with the agreement exchanged through e-mail system.
- Organization of agreement: There are some organizations formed through
agreements and the electronic media. In there, organizations use the information
system to create virtual warehouses for the storage of goods. Thus, an enterprise
provides fresh flowers such as delivery service of post office can deliver fresh
flowers to customer anywhere and anytime.
- The traditional organization with electronic components: This form of
organization is familiar with the enterprise. It only replaces some departments of the
enterprise by electronic communication structures.

The use of the electronic

communication equipments to support the traditional organization requires the
managers always pose the questions of whether information technology has the
ability to replace completely the components of the organization or not?
- Organizational links: This is a form of organization established between the
customers and suppliers. The big customers often send orders as in their business
schedule and require the small suppliers have to provide them as if it were a
member of a parent organization. The enterprises producing automobiles and
motorcycles often establish such relationships.
3. Strategic options for information technology applications
Enterprises can select the suitable information technology strategies’ application for
business depending on their goals. General, it divides to four levels:
Enterprises bound to apply IT in their business
Virtually, specific businesses whose need the security sectors (bank finance) or

legal provisions or specific industries need (software companies, online purchases)
Indispensable
Application of information technology will grow businesses’ profitability and
competitiveness or international economic integration. In short term, it is essential
factor for companies who are planning to develop business outside the nation
al boundaries.
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Wish

to

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do

This strategy applies to enterprises having long-term goals. If the enterprises apply
information technology to the management as well as production, business will
have potential growth and growth profitability in the future due to increasing brand
reputation.
It would be better if the enterprise apply information technology for their business
The urgency of the application of information technology is ambiguousness in this
strategy. Despite we cannot deny the technological potentiality, but it is not a
pressing need. However the business can go ahead to welcome the application of
information technology if they powerful enough.
Thus, the development of IT needs to put in the general strategic planning to
develop of the business to fit the environment sector as well as the development
trend of the future.

General, in addition to analyse the impact of industry or business environments, we
can see that the effectiveness of strategies is important factor to evaluate the
development of business in the near future when we build the strategies to
information technology development. This is a difficult question for all business
when they have to decide which is the best strategy?

III. Vietnam Local Businesses’ experiences in this area.
In the field of motor-production in Asia, Japan is the pioneer in copying European
designs. Although there are many businesses invested in this sector, but until now
only four major labels such as Honda, Yamaha, Suzuki, Kawasaki is also survived.
In the 80s, the technology system transfer to Taiwan before Mainland China
receiving. China became the imitative workshop, most large-scale replication, and
low quality products accounted for 50% of motorcycles in the world.
In this market, Vietnam certainly cannot compete with China because the
production in Vietnam is not large, and the consumer demand is not high enough.
Nearly 80% of businesses closed. The Sole representative of China Lifan is also
closed when engaged in manufacturing fitting armour motorcycles in Vietnam. If
the organization produced by Japanese firms, the difficulties of funds as well as
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technology. Requires their own style design, own engine design to avoid copyright
infringement, useful technology solutions that they have registered. Vietnam is not
in their strategy transfer of technology, and businesses do not have sufficient
financial resources. The basic thing is the manufacturing and assembly businesses
bordering Vietnam does not have a brand development strategy and comes with it is
a strategic of information technology application.

1. Valuable experiences that Vietnam enterprises should learn
Vietnamese enterprises can develop the potential latent in every individual in the

organization to create maximum job performance. Why in the same market, the
same macroeconomic environment, and a technical environmental technology, there
are some businesses exists, in contrast, another dissolution. How to survive in
developed together with leading companies. According to the strategies of Japanese,
firm and apply a smart suitable selection for your business is the only way for
Vietnamese enterprises.Referent to the enterprise who leading in the processing to
manage informations in the following diagram, also known as “information
management circle”:

2. The application of IT in business
Usually, the focus on develop business, including the application and
commercialization of technology products, services or the process of working, their
management. Vietnam enterprises often fall into this category, for example in the
manufacturing, construction and commercial services. We often see the information
technology applications popular in the field of accounting, very simple and local.
Today, the application of IT for Vietnam enterprises is not only accounting, but also

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more strategy-oriented applications. Increasing cooperation and further integration
is vital for the application of information technology in Vietnam enterprises.
Oriental integration mainly includes:

The strategic orientation towards issues such as the form of cooperation, the vertical
change in the whole structure, methods of marketing, distribution channels
The oriented organizations on issues such as organizational structure, method of
administration, training, labour organizations
The oriented technology products and services, manufacturing systems, information
systems, electronic data processing

3. The difficulty in IT application for Vietnam enterprises
Particularly in small businesses, making the latest information technology model is
not always smooth. These include a number of reasons for this.
First, Vietnam enterprises often does not have knowledge in the field of information
technology, because they only pay attention to the operations, so spend a little time
for strategic activities to improve and. This also prevents their own accumulated
knowledge about the latest developments
Second, Vietnam enterprises often are not aware of the information sources they
should consult. This causes them to lag in technology, not fully understanding the
capabilities of IT and not aware of the advantages of a particular application.
Third, IT can lead to unpredictable advantage. Many small businesses thus cannot
establish their exactly needs without the help of external experts. The IT solution
providers tend to offer open system, more complicated than necessary and often do
not know the exactly information about the time it takes to learn how to operate the
systems.
Fourth, IT improvement usually starts with the process of technology production,
this improvement requires change many functions, duties and responsibilities of the
department compared with the other improvements. It impacts to not only inner the
organization but also the job itself and staff’s duties. The businesses leave behind
the technology mainly due to a lot of restrictions on the organization.

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All we needed is to set up processes and standardized information that lacking in

Vietnam enterprises, due to their working methods are not official. Moreover, the
use of IT for the purpose of improvement also requires adequate visions.
4 - Challenges for CIOs in Vietnamese enterprises
Current difficulties of CIO management model in Vietnam is the foundation of
vertical and horizontal, strategic understanding of their business technology service.
In Vietnam, people who are taking on this role is not much. Although operating in
any area, large or small, in the next few years, the absence of a director of
information technology capability and bravery will be a big disadvantage.
Major challenge in the future is CIO has to faces to the opponents who has a
thickness in all areas: management capacity, the level of technology, distribution
and supply system special is the quality of products and high services. When
integrated, the urgent require of all businesses is a standard process, modern and
"compatible" with the changes of the new market., so the CIO must understand the
environment, business capabilities When the information is a competitive
advantage.
In particular, they have to understand the mechanism operation of the current
economy, how to make the most important advice for leaders, product application
before, how competitive, where efficient.

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