QUẢN TRỊ HOẠT ĐỘNG tại CÔNG TY cổ PHẦN sữa VIỆT NAM VINAMILK en

OPERATION MANAGEMENT AT VIETNAM DIARY PRODUCTS
JOINT STOCK COMPANY (VINAMILK)
TABLE OF CONTENT

I. PREFACER...................................................................................4
II. INTRODUCTION OF VINAMILK......................................................4
II.1. General...................................................................................4
II.2. Summary.................................................................................5
II.3. Factories and stores of Vinamilk..............................................6
II.4. Dairy farm...............................................................................7
II.5. Organisation chart of Vinamilk.................................................7
II.5.1 Chart of organisation structure..............................................7
II.5.2 Chart of management structure:............................................7
II.5.3 Shareholders’ s existing structure of Vinamilk........................8
III. QUALITY STANDARD AND MAJOR PRODUCTS...............................8
III.1 Regulation of milk processing and milk- made products............8
III.1.1 Legal regulation...................................................................8
III.1.2 Governed specification and standards.................................10
III.2 The quality standard system of Vinamilk................................10
III.2.1 Management standard and safety, sanitation :....................11
III.2.2 Standard of environment:...................................................11
III.2.3 Standards of the technical properties of the products:.........11
III.2.4 Other technical standards...................................................12
III.3 Major products of Vinamilk....................................................12
III.3.1 Vinamilk market.................................................................12
III.3.2 Major products...................................................................14
IV. MANUFACTURING PROCEDURE OF MAJOR PRODUCTS.................15
IV.1 Procedure of fresh milk production:........................................15
IV.1.1 Chart of technology process:...............................................15
IV.1.2 Production procedure..........................................................15
IV.2 Production procedure of the powder milk:..............................17

IV.2.1 Chart of technology process:...............................................17


Group assignment

Operations Management

IV.2.2 Manufacturing procedure....................................................18
IV.3 Production procedure of Yogurt..............................................20
IV.3.1 Chart of technology process:...............................................20
IV.3.2 Manufacturing procedure:...................................................20
V. LONG TERM TARGET FOR PRODUCT QUALITY IMPROVEMENT :.....21
V.1 Concept of the long term target ;............................................21
V.2 Concept of the product quality:...............................................22
V.3 The existing product quality of Vinamilk..................................22
V.3.1 Raw materials......................................................................22
V.3.2 Technology and technology transfer.....................................23
V.3.3 Quality management system................................................23
V.3.4 The procedure of the quality management............................23
V.3.5. Food sanitation safety:........................................................24
V.4 The long term target for improving the product quality of
Vinamilk.......................................................................................25
V.4.1 The safety product to ensure the health for the consumers...25
V.4.2 Improving the health and enhancing the physical nature......27
VI. PLAN FOR LONG TERM TARGET PERFORMANCE.........................27
VI.1 Long term target of Vinamilk.................................................27
VI.2 Plan for the long term target performance.............................28
VI.2.1. Plan of the brand development..........................................28
VI.2.2. Plan of developing, expanding the products.......................28
VI.2.3. Plan for the market increase..............................................28

VI.2.4. Plan of the management system: Continue to improve the
capacity of the supply system management..................................29
VI.2.5. Plan of the distribution system: Continue to expand and
develop the active, strong and efficient distribution system..........29
VI.2.6. Plan of the raw material source: Developing the raw
materials to assure the stable fresh milk supply source with the
high, reliable quality and the competitive price.............................29
VI.2.7. Plan of the human resource: Wit the current milk branch
development strategy, Vinamilk defines the “human being” factor to
decide the success or failure of the company. Thus, the company
proposes the plan for performing the human resources as follows: 29
VI.2.8. Financial plan....................................................................30
VII. DIFFICULTIES, CHALLENGES AND COUNTERMEASURES.............33
VII.1. Difficulties and challenges:..................................................33
VII.1.1. Analyzing SWOT...............................................................33
VII.2 Countermeasure...................................................................35
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VIII. CONCLUSION.........................................................................38
REFERENCES................................................................................38

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I.

Operations Management

PREFACER
The enterprise operation management is the necessary management technical

system to be conducted synchronously by the enterprise managers so that the enterprise
can reach the proposed strategy target. The study of this system is required to closely
contact from the scientific theory to the existing operation of a detailed enterprise so that
the learner gets the synchronous knowledge and the full awareness of the importance of
the science of the operation management in managing, executing an enterprise.
From the above mentioned demand, in this material, the group 4 refers to the
operation management in Vietnam Diary Products joint stock company (Vinamilk)
mentioning the long term target for improving the product quality of the company; the
plan for the long term target performance and difficulties, challenges, countermeasures
upon conducting the long term target of the company.
II. INTRODUCTION OF VINAMILK
II.1. General1
Vietnam Diary Products joint stock company (Vinamilk) has been established since
1976 under the name of Southern Coffee-Milk company. This is a state run enterprise
directly under General Department of Food. During the development process, after many
reforms, Vinamilk became Vietnam Diary Products joint stock company in the year 2003.
The transaction name in English is VIETNAM DAIRY PRODUCTS JOINT STOCK
COMPANY abbreviated as Vinamilk.
The company has been sealed on Ho Chi Minh city stock exchange transaction floor
on 19 January 2006 (transaction code: VNM). At present, State Capital Trade and
Investment Corporation (SCIC) holds the ratio of 45,05% for the company charter
capital.

Vinamilk is the topping enterprise of the milk processing industry accounting for
75% of the milk market in Vietnam. The products of Vinamilk includes the fresh milk,
yoghurt, condensed milk, powder milk, nutritious milk, cream, various soft drinks. With
the diversification of the products, Vinamilk appears over 200 sterilized, pasteurized milk
items, and milk-made products.

1

Summarized from website www.vinamilk.com.vn/ and annual report of VNM 2012
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On 31 December 2012, Vinamilk has the network with 250 exclusive distributors
and over 200,000 retail points in Vietnam. The Vinamilk products are exported to 26
countries like America, France, Canada, Pháp, Canada, Poland, Germany, Middle-East
regions, ASEAN etc
After 36 years since the establishment and counted to 31 December 2012, Vinamilk
has invested 12 plants, 2 factories in which Vietnam Children power milk factory is put
into operation on 22 April 2013 and milk factory constructed by Tetra Pak group –
Swedish in Binh Duong and operated on 10 September 2013. Vinamilk is executing the
milk factory in Cambodia in 2014.
During 17 years, from 1997 to 2013, Vinamilk is ceaselessly selected as the high
quality Vietnam goods by Vietnam consumers’ association.2
Vinamilk joins the charitable activities, society in the fields: Setting up Vietnam
reaching Milk Fund, providing milk for all children of the difficulty; establishing Vinamilk
scholarship fund “Nursing the young talented”; Setting up 1 million of green plants for

Vietnam and sponsoring the solar energy lights at Con Dao.
At present, Vinamilk has got the 68 th rank of the world biggest 100 milk enterprises.
The target of Vinamilk in the next stage is to get turnover of 3 billion USD in 2017 and
Top 50 enterprise of the world milk.
II.2. Summary 3
Head office: 10 Tan Trao, Tan Phu ward, district 7, HCM city
Tel: 0854155555 /Fax: 0854161226
Year of establishment : 1976
Charter capital of the year 2012: 8,340 billion VND equivalent to 396.46 million
USD
Total investment cost of the year 2012: 10,235 billion VNĐ, equivalent to 488.45
million USD
Business field: Food and Beverages;
Major products: Milk and milk-made products

2
3

According to website - Enterprise Association of high quality Vietnam commodity
Theo website www.vinamilk.com.vn/ and annual report of VNM 2012
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Manpower : 4,300 persons
Website: www.vinamilk.com.vn
Email:

Logo of Vinamilk:

Figure 1: Logo of Vinamilk
II.3. Factories and stores of Vinamilk4
Factories:
1)

Thong Nhat milk factory – No. 12 Đang Van Bi, Thủ Đuc district, HCM city

2)

Trường Thọ Milk factory – No. 32 Đang Van Bi, Thu Đuc district, HCM city

3)

Dielac Milk factory – Bien Hoa I Industrial Park, Dong Nai.

4)

Can Tho Milk factory – Tra Noc Industrial Park, Can Tho.

5)

Sai Gon Milk factory – Tan Thoi Hiep Industrial Park, District 12, HCM city.

6)

Nghe An Milk factory – Sao Nam street, Nghi Thu ward, Cua Lo town, Nghe
An.

7)

Binh Đinh Milk factory-87 Hoang Van Thụ, Quang Trung ward,Quy Nhơn
city, Binh Đinh.

8)

Vietnam Soft Drink factory – My Phuoc II Industrial Park, Binh Duong
province.

9)

Tien Son Milk factory – Tien Son industrial park, Bac Ninh province.

10) Đa Nang Milk factory – Hoa Khanh industrial park, Danang city.
11) Vietnam Powder milk factory - 9 Freedom Boulevard – Việt Nam-Singapore
Industrial Park, Thuận An district, Binh Duong province.
12) Vietnam Milk factory – My Phuoc II industrial park, Binh Duong province.
Warehouse:
1)

Depot enterprise – No. 32 Đang Văn Bi, Thủ Đức district, HCM city

2)

Hanoi Depot enterprise – Km 10 National road 5, Dương Xa town, Gia Lâm
district, Ha Nội.

Clinic :
4

Vinamilk – Incorporated finance report, year 2012
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An Khang General Clinic - 87A CMT8, District 1, HCM city

II.4. Dairy farm
1)

Dairy farm in Tuyen Quang;

2)

Dairy farm in Lam Đong;

3)

Dairy farm in Binh Đinh;

4)

Dairy farm in Nghe An: the rest cell of cows is laid with the soft mattress,
auto milking with the « super-cleaned » technology”;

5)

Dairy farm in Thanh Hoa.

II.5. Organisation chart of Vinamilk
II.5.1 Chart of organisation structure

Figure2 : Organization chart as per the function
II.5.2 Chart of management structure:

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II.5.3 Shareholders’ s existing structure of Vinamilk5

Figure 3: Shareholders’ structure
III. QUALITY STANDARD AND MAJOR PRODUCTS
III.1 Regulation of milk processing and milk- made products
III.1.1 Legal regulation

5

According to website: />8/34

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Vinamilk is an enteprised operating in Vietnam . Therefore, the prerequisite
condition of Vinamilk is to comply with the Vietnam legal regulations of the milk quality
and milk products. These regulations include:
- Law on Food safety No. 55/2010/QH12;
- Law on Standard- Specification No. 68/2006/QH11;
- Environmental protection law No. 52/2005/QH11 dated 29 November 2005;
- Decree No. 127/2007/NĐ - CP dated 01 August 2007 of Government specifying
the details of implementing some articles of Law on Standards and technical
specifications;
- Governemental Decree No. 38/2012/NĐ-CP dated 25 April 2012 stipulating the
details of some articles of Law on food safety;
- Circular No. 30/2010/TT-BYT of Ministry of Health dated 02 June 2010 issuing
the national technical specification (QCVN 5-1:2010/BYT) to the products in the form
of liquid;
- Circular No. 31/2010/TT-BYT of Ministry of Health dated 02 June 2010
specifying the issuance of the national technical specification (QCVN 5-2:2010/BYT) to
the milk product of the powder form;
- Circular No. 41/2010/TT-BYT of Ministry of Health issuing national technical
specification to fermentation milk products;
- Circular No. 05/2012/TT-BYT dated 01 March 2012 of Ministry of Health issuing
the national technical specification (QCVN 8-3: 2012/BYT) to the micro contamination
in the food;
- Circular No. 26/2012/TT-BYT stipulating the issuance of qualified certificate of
the food safety to the foundations of manufacturing, trading functional foods, nutritious
increasing food etc.
- Circular No 20/2012/TT-BYT issuing the national standard of the formular

nutritious food for the children to 12 months ;
- Circular No. 21/2012/TT-BYT issuing the national specification to forumular
nutritious products with the medical purpose especially for the children to 12 months ;

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- Circular No. 22/2012/TT-BYT issuing the national specification to the formular
nutritious product with the supplementary eating purpose for the children from 6 to 36
months old.
III.1.2 Governed specification and standards
What is the standard6
The standard is to specify the technical properties and the management requirement
as the standard to classify, evaluate the products, goods, services, process, environment
and other objectives in the economic-social activities to improve the quality and
efficiency of these objectives.
What is the technical specification7
The technical specification is to specify the limit of the technical properties and the
management requirement in which the products, goods, services, the process,
environment and other objectives in the economic-social activities have to comply with
to ensure the safety, sanitation, health of the human being, protecting the fauna, flora,
environment, interest and national security, rights of the consumers and other necessary
requests.
III.2 The quality standard system of Vinamilk8
The governed quality standard system in Vinamilk includes Vietnam and
international standards. These standards include the management standard, standard of

environment, food sanitation standard and standard of technical properties of the
products.

6

Source : Law on Standard- Specification No. 68/2006/QH11
Source: as above
8
Source :
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III.2.1 Management standard and safety, sanitation :
Vinamilk applies the quality management and control system of ISO-9000-2008;
Vinamilk applies HACCP as a system to control systematically the factors affecting
the food safety. HACCP is abbreviated by Hazard Analysis and Critical Control Point .
This is the principle and analyzing method of the risks to the food safety developed by
CODEX Commission (established by FAO and WHO organizations). On the foundation
of these principles, the countries and regions have developed HACCP standards in
accordance with their management requirement. In Vietnam, issued HACCP standard is
TCVN 5603:1998 (this standard is totally equivalent to CAC/RCP 1 - 1969 of CODEX).
At present, Vinamilk applies HACCP RvA standards of Netherlands.
The factory ratio gets the certificate of HACCP and ISO 9001: 2008 is 10/11
factories. Danang factory completes the construction and is put into operation since the
end of the year 2012. In the year 2013, this factory is evaluated and issued with the

certificate .9
III.2.2 Standard of environment:
Vinamilk applies ISO 14001:2004 standards of the environmental management
system – Requirements and use guidance at their factories. This is the standard in ISO
14000 set specifying the requirements of managing the factors affecting the environment
during the operation process of the organizations, enterprises.
This standards is used to construct and certify the environmental management
system according to ISO 14000 including 03 basic commitments requested in the
environmental policy:


Pollution prevention ;



Legal conformance ;



Ceaseless improvement of EMS system

III.2.3 Standards of the technical properties of the products:
According to law on standard- Specification No.

68/2006/QH11, Vinamilk is

compulsory to comply with the national standards of milk and products from milk.
Vinamilk has announced the core value of “Complying with the law” and “ Respecting
the established standards…”10.

9

Sustainable development report 2013 of Vinamilk
Annual report of Vinamilk 2012

10

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Therefore, Vinamilk has to apply the national standard No. QCVN 5-1:2010/BYT to
the milk products in the liquid form; No. QCVN 5-2:2010/BYT to the milk product of the
powder type, and QCVN 8-3: 2012/BYT to the micro-pollution in the food.
In addition, Vinamilk applies the standard TCVN: 7028:2002 Sterilized fresh milk –
Technical specification

11

and Vietnam standards like TCVN 7405: 2004 – Raw material

fresh milk. Technical requirement; TCVN 7108:2002 – Powder milk for the children to
12 months old – Technical regulation; TCVN 5538:2002. Powder milk- Technical
specification etc.
III.2.4 Other technical standards
ISO/IEC 17025:2005 is General Requirements for the competence of testing and
calibration laboratories. ISO/IEC 17025:2005 is the standard of the quality management

system applied separately for testing laboratory and calibration issued by ISO
(International Organization for Standardization).
Vinamilk applies ISO/IEC 17025:2005 for the product testing laboratory. The
criteria, limit and testing methods STNL of Vinamilk comply with the international
standards as FAO (Food & Agriculture Organization), FDA (Department of Food and
Pharmacy of America ).12
In short, at Vinamilk, a criteria grasped by the company is to comply absolutely
with the legal regulations of the management standard, safety, food sanitation of Vietnam,
the international standards in the food trade (Codex). Thus, the products of the company
have appeared at 26 countries in the world like America, Australia, Canada, Russia,
Japan, Thailand, Korea, Philippines, Middle-East regions etc
III.3 Major products of Vinamilk
III.3.1 Vinamilk market

11
12

Source: Product standard announcement No. 12/2006/CBTC- VINAMILK dated 17 February 2006
and />12/34


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Figure 5: Market of fresh milk 2012 (Source:: Website Businessman world)

Figure No. 6: Market of powder milk 2012
(Source : Website Business world )

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Figure 7: Profit structure of 09 months, 2012
(Source : Website Busines world )
III.3.2 Major products
In 2012, The fresh market of Vinamilk accounts for 45,5% of Vietnam market, the
1st rank. Fieslandcampina takes the 2nd rank with 20,4% market. The powder milk of
Vinamilk makes up 19% taking the 2nd rank after Abbott (24%).
“Calculating the turnover and the capacity, Vinamilk is the top milk manufacturer in
Vietnam. The product list of Vinamilk includes the major products of water milk and
powder milk; The plus valuable product like the condensed milk, eating yoghurt and
drinking yoghurt, cream and cheese”.13
“04 years ago, the condensed milk capacity manufactured by local companied
reached 312 million of boxes /year while the foreign companies producing it in Vietnam
got 92 million of boxes/ year. The average growth speed of the condensed milk is
10%/year. However, in the phase 2009-2014, the growth speed is only about 3%, lowest
in the categories of the milk. It is because most of the consumers in the city has used the
fresh milk instead of the condensed milk.
So, the market of the condensed milk has slowly grown up in the saturated manner
and it is not attractive and competitive among the brands anymore.”14

13
14

Source : />Source: />14/34

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In short: In the master strategy of the long term development, Vinamilk defines to
“concentrate on the main business branch of the milk production: Focusing on 04 major
branches including water milk, condensed milk, powder milk and yogurt”. 15 However,
based on the market and turnover structure, the profit from the milk and the product from
the milk, we can conclude that the major milk product of Vinamilk is currently the fresh
milk, powder milk and yogurt.
IV.

MANUFACTURING PROCEDURE OF MAJOR PRODUCTS

IV.1 Procedure of fresh milk production:
IV.1.1 Chart of technology process:

Processing
filling UHT
milk
Raw material
Store

packing

Store

fresh milk

Pasteurizing
milk fillin

Powder,
sugar, taste

packing

cooling

Figure 8: Processing chart of Vinamilk fresh milk
IV.1.2 Production procedure
1). Raw materials: Milk is taken from the cow raised up by the natural grass ; not
using chemical fertilizers and no antibiotic injection. The cow supplying the
cleaned milk raw materials is raised as per the TMR method (Total mixing
rotation) including fresh grass or sullen, honey leaked, bran, draff etc assuring
the nutritious substances to create a lot of milk with the high quality.

15

Source: Annual report of Vinamilk 2012
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Figure 9: Raising cow at farm of Vinamilk (Source: Annual report of 2012)
2). Milking: The whole auto milking line of Delaval firm helps the cow milk to run

straightly into the cooling system quickly from 37 oC down to 4oC, assuring the
milk is stored at the best before being taken to the manufacturing factory.
Vinamilk Dairy Farm has the very special regulations to the staffs to help the
cows to be the most comfortable. For instance, during the milking process, the
staff has to switch off mobile phone not to cause noise, stress to the cows. Upon
getting in touch with the cow, absolutely be gentle, friendly and not making
noise, scalding making them stressed;
3). Transportation: Within the limit time (24-48h), the milk tanks are transported to
the processing factories. The supervisor accompanies by the transportation..
After the raw material fresh milk has been cooled lesser or equal to 4 o C, the
milk will be received by the specialized tank vehicle and transported to the
factory within 24-48h. The transfer station has to send the representative to
accompany the vehicle to ensure the absolute safety of the quantity and quality
of the milk during the transportation process .
4). Testing and classification: The milk is tested and qualified to process and store at
the temperature equals or lower than 40C at the store of the processing factory .
5). Processing: The qualified milk for processing is moved to the filter to measure,
weight, the cooling system, standard store tanks, milk standardization devices,
milk assimilating equipment, UHT (Ultra High Temperator). This is the
extremely high heating device, then extremely quick cooling. This heating
procedure will kill toxic bacterium, kinds of ferment mushrooms, mildew etc but
still keeps to maximize the nutrition and natural taste of the filtering and milk
processing products

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Figure 10: UHT system (Source: Website Businessman world )

6). Packing: Processed milk is transferred to sterilized machine system, the milk
quality tests and brought to the packing line with the closed, modern, advanced
technology from the developing countries like Sweden, America, Denmark,
Netherlands, France, Germany, Swiss helping to assure the quality and safety of
the food. The canned milk product keeps the nutritious contents like vitamin and
minerals from the fresh milk at the highest level.

Figure 11: Packing line of sterilized milk of Vinamilk
(Source: Website Business world )
7). Store. Sterilized milk is transported into the normal store. The pasteurized milk
is transported into the cooling store with the low temperature for protection.
IV.2 Production procedure of the powder milk:
IV.2.1 Chart of technology process:
PROCESSING

Raw material
store

Powder, sugar,
Assimilation

Mixin
g

admixtures

standardizatio

n

Drying

Assimilation

Pasteurizing
750C

condensing

seizing

packin
g

Figure 12: Vinamilk powder milk processing chart
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IV.2.2 Manufacturing procedure
Vinamilk powder milk processing factories have the closed technology line from
receiving the raw materials to the product output. All phases are automatic both in
creating the quality products and in assuring the food safety sanitation at the highest

level. In particular, the technology of Binh Duong powder milk factory is supplied by
GEA/NIRO group and world top firms under G7, EU, Germany, America, Japan. The
drying tower is the topping modern multi-storey double tower with the diameter of
13,6m, height of 32m in Asia.
The whole processing procedure is supervised, controlled automatically to control
closely the quality of the raw materials and finished products from the input to the
customers exactly. From here, the nutritious products with the high quality and
international standards like Dielac Alpha, Dielac Optimum, Dielac Pedia and other
products will be manufactured for local and foreign markets.
The production procedure of the powder milk includes the following steps:
1). Raw materials: The raw materials to manufacture the powder milk is the original
cream fresh milk or single milk. The originally cream milk is the products
manufactured from the fresh milk not adjusting the fat content. The single milk
is the product manufactured from the fresh milk separated from a port of the
fatness.
2). Mixing admixtures: The admixtures in the powder milk production are used as
the stable substances (polyphosphate, orthophosphate of Na, K, Ca), lecithine
creating substance, anti-oxidization substance etc.
3). The milk standardization process: In order to adjust the fatness content in the
raw materials and to be carried out on the auto line including centrifugal
machine, mixing device, measuring tools (flow indicator, aerometer etc) pumped
into the storage tank.

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4). The next step is the sterilization to reduce the micro content in the milk to the
lowest level, concurrently invalidating the activation of enzymes, especially
sustainable enzyme group of lipase changing the nature of protein. The
pasteurization is carried out at the temperature 75 0C, in about 30 seconds. The
pasteurizing process of the milk is conducted on the heating exchanging
equipment in the thin plate form.
5). The condensate phase to separate water out of milk to save the energy for the
next drying process. The condensed technology is done by vacuum method for
the products against the contamination, non-ruined fatness and vitamin.
6). The assimilating process: conducted to reduce the dimension of the fatness
grains and distributed evenly in the milk because the fatness content in the milk
after the condensed process is quite high.
7). The next step is to dry the milk. The products processed from the milk
condensed to the dry level of 35 - 40% is dried, grinded into the powder, seized,
sifted into the milk at the powder form with the dryness 90 - 96%, moisture 4 10%. The drying technology line of Vinamilk is the spray drying.
8). The powder milk after the spray drying will be passed to the sifting system and
into the packing equipment. It is usually applied with the metal bags or paper
bags to contain the products. The common request of the package is to limit the
contact of the lights, air, and moisture from the ambient environment to the
powder milk. The packing is usually applied in the vacuum condition or blowing
the mixture of 90% nitrogen, 10% hydro into the boxes before covering to
extend the time of the product store.
9). The production phase of the powder milk from the mix to the package etc is
carried out on the high auto equipment line.
10). The packing powder milk is transported into the store of Vinamilk to supply for
the market.

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Figure 3: Robot (LGV) controls the whole production process at Vietnam Milk factory,
Binh Duong
(Source: )
IV.3 Production procedure of Yogurt
IV.3.1 Chart of technology process:

PROCESSING

Raw material
store

Powder,
sugar, taste

Mixing
Hiding

Heating
ferment implant

Cooling

Assimilating 1
down heating

Filling tank

Cooling

Assimilating 2

packing

Aging
Pasteurizing

cooling store

Figure 14: Processing chart of Vinamilk Yogurt
IV.3.2 Manufacturing procedure:
1). Raw materials: The powder milk mixed further with the sugar to get the content
8 - 10 %
2). Mixing: Milk powder, sugar, butter, stable substance mixed at the temperature
45oC for the evenly dissolving process.
3). Heating: Increasing the temperature to 60oC to match the assimilation process;
4). Assimilation: Conducted in the assimilation machine to create the high pressure
of about 200 bar by the piston pump system to demolish fat grains into the raw
materials and dispersing different substance forming the synchronous mixtures.
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5). Cooling: the milk is passed by the heat changing equipment of grate type with

the external cooling for the temperature down to 5oC leading to ageing tank.
6). Ageing: Milk to stay in the tank in 1-2 hours at 5oC
7). Pasteurizing: Increasing temperature to 95oC in 1 minutes
8). Assimilation 2: At the temperature of 95oC, pressure of 200 bar
9). Heat down: to the suitable temperature with the fermentation process of the
lactic bacterium (43oC)
10). Fermentation implanting: The fermentation is used as the Lactobacillus
bulgaricus bacterium (the tree shape) and Streptococus thermophilus (sphere
shape) under Streptococea, họ Lactobacteriaceas. The milk after the temperature
decrease goes down 43oC (pH at the moment reaches about 4,4 – 4,5). At the
same time, the ferment from the ferment tank is injected into the ferment
implanting tank. The fermentation content accounts for 5% of total quantities of
the products.
11). Hiding phase: 43oC; 4 -5 hours; pH after hiding is about 4,7 - 4,8. Hiding to
create sufficient time, creating the suitable condition for the fermentation process
transferring the lactose sugar into acid lactic.
12). Cooling: 15oC to minimize the fermentation process;
13). Dropping tank: After cooling, the milk is transferred to the dropping tank to
prepare the packaging work.
14). Packing, labeling: The plastic roll is sterilized at 115oC, mounded and transferred
to the filling tank. Yogurt is dropped and labeled (the label is sterilized by
infrared ray).

Figure 15: Canning and dropping line of yogurt .
(Source : Website Businessman world )
V.

LONG TERM TARGET FOR PRODUCT QUALITY IMPROVEMENT :

V.1 Concept of the long term target ;

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The long term target of the enterprise is the jobs proposed by the enterprise and try
to reach in the quite long time (usually over 3 years). The long term target is necessary to
get the strategic planning process.
V.2 Concept of the product quality:
In the world, the product quality is the term mentioned for a long time. This field
has many different understandings, accesses and the non-high consistency. The quality
field in our country at this moment is quite new. Thus, the definition of the quality in our
country has not been done and only understood according to the definitions in the world.
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If the definition of the product quality origins from the properties of the products,

Walte.A. Shewart- an American manager is the person to start and work as the
representative for this concept. He states “ The product quality in the industrial
production is a complex of the natures of the products affecting the use values.
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If the definition of the product quality originates from the manufacturer: The

product quality is to reach and comply with the standards, technical economic
requirement as designed before.
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In the ’20 years, in the countries, there have appeared some groups of the new

concept of the quality, not accessing the quality field in the narrow space, not only
concentrated on the internal factor, but approaching the quality field based on the
conditions of the customer’s demand, manufacturer’s ideas and ceaseless improvement
etc. the product quality will not be backward. Thus, the quality definition originates from
the customers: The quality is suitable to the requirement and the purpose of the customer.
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The definition of the product quality comes from the relationship of cost-

benefit: The product quality is to satisfy the payment ability of the customers.
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The definition of the product quality comes from the competition: The product

quality is to create the features of the products and services the competitor cannot get.
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The definition of the product quality comes from the market: The product quality is

the satisfaction and exceeds the customer’s desire.
V.3 The existing product quality of Vinamilk
V.3.1 Raw materials
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At present, the raw material fresh milk of Vinamilk has 02 main supply sources:

From the household raising the milk cow and from the farm system of Vinamilk.

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Operations Management

The purchasing capacity of the year 2012 gets 161,591 tons, reaching 100,645

compared to the plan and increasing 12,24% compared to the year 2011, in which the
procurement from the subsidiary as Vietnam Dairy Co.,tld supplying 20,051% tons.
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At present, Vinamilk has 05 dairy farms with total quantities of 8,200 cows. The scale

for each farm is from 2.000-3.000 cows. Total cows imported in the year is 664 pcs.
V.3.2 Technology and technology transfer
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During the investment process, the company always heads the modern nature,

consistency, selection of the countries with the technology and equipment of the milk branch
under development like Sweden, America, Netherland, Germany, Swiss. In particular, the
newly constructed factory at My Phuoc 3 Industrial Park- Binh Duong is equipped with the
total auto smart store.
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The company attaches importance to the technology transfer and regards it as the

key of the success. From the application of the adaptable technology, it is gradually
transferred to the master of the technology and improve it to match the local situation.
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In addition, the company is expanding the information technology system in the

whole company to meet the ever increasing developing demand of Vinamilk.
V.3.3 Quality management system
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Vinamilk always reaches the success by the fact that we top the product quality. Not

Vietnam Children’s powder milk factory alone, all the factories Vinamilk operate according
to the international quality management system of ISO, HACCP, evaluated as the quality by
the organizations of the world topping certificate .
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Applying the management model according to ISO 9001 and the food safety in the

chain “from the farm to the eating table ”.
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Right from the original design for the workshop, machines, equipment, Vinamilk

attaches importance to the best target of the product quality by applying the standards of
HACCP for the workshop, equipment, and controlling air environment. The nutritious
components, the quality products meet the international food standard of CODEX.
V.3.4 The procedure of the quality management
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The quality management department proposes the technical requirement;

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The export and import department buys goods according to the proposed technical

requirement;
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Operations Management

The foreign imported raw materials have to be checked and confirmed from the

department of Food Sanitation Safety;
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The quality checking department at the factories checks the quality for all raw

materials before putting them into production. During the production process, all
processing parameters like the temperature, time, pressure etc are stored;
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The final products have to be analyzed with the physical and chemical properties

and micro. The analyzing results suitable to the standard have to be announced before
exporting the goods.
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For instance, the following is the product quality management procedure of the raw

material fresh milk (STNL):
 After getting the tests at the procurement station, STNL is cooled to 4 ± 20C and
stored at this temperature during the storing process at the station and
transportation to the factor to limit the development of the creatures.
 As for STNL source from the farms of Vinamilk, STNL right after squeezing, it
is cooled to 4 ± 20C and follows up the pipeline into the storage tank. The
quality STNL is equivalently checked like STNL of the agriculture household.
 Right when coming to the processing factory, STNL is sampled and checked
with the criteria to define the quality and confirm the storing condition,
transportation from the station to the factory meeting the technical requirement
like the milk temperature, the sense organs, alcohol test, acid content., test
resazurin, content of the dry substance, fatness content, protein content etc .
 At present, internal testing laboratory system of the factories, Vinamilk has got
the standard certificate of ISO 17025 with the modern machine, equipment and
well-trained, qualified, professional workforce with the high responsibility .
 The criteria, limit and testing method STNL of Vinamilk comply with the
international standards as the standard of FAO (Food and Agriculture
Organization), FDA (Department of Food and Pharmacy of America) etc. In
addition, STNL samples are periodically checked by the third body to prove the
conformance with the standard criteria and food safety.
 In order to ensure and enhance STNL quality from the agriculture household,
Vinamilk has developed the cooperation programs and guided the farmers with the
technology of the cow raising, the nutritious policy, farm sanitation, milking pattern
and store.

V.3.5. Food sanitation safety:
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Operations Management

The food sanitation safety is one of the topping quality policies proposed by

Vinamilk in the business activities. All factories of Vinamilk are constructed and applied
with HACCP system of the food sanitation safety . The factories have been evaluated and
granted for the certificate of HACCP system as per RVA standard of Netherland by SGS,
BVQI.
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The food sanitation safety is strictly carried out from the selection of the raw

mawterials to the finished products.
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As for the raw materials: The company issues the technical request highlighting the

requirements of the safety of the food sanitation. In addition to the chemical and physical
natures, it is to meet the following demands:
 During the production process: All the processing parameters have to meet the
requirements like the fact that in the risk analysis of HACCP system, the
important controlling points are operated, observe and reported by the staffs.

 The archiving dossiers in the parameters have to be stored until the expiry of the
product.
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As for the finished products: The quality control department of the factory will

check each production lot according to the specified procedure. When the checking
results meet the requirement combined with the consideration of the parameters, it makes
conclusion of the goods export.
 The checking dossiers for each package have to be archived until the expiry of
the product. The samples of various product have to be periodically sent to the
authorities to analyze and evaluate the conformance level of the system.
V.4 The long term target for improving the product quality of Vinamilk
As the manufacturer of the products related directly to the nutrition and the human
being health, the target during the business operation of Vinamilk is to top the quality .
Thus, Vinamilk has defined the long term target to improve the product quality as
follows:
V.4.1 The safety product to ensure the health for the consumers
V.4.1.1 Studying, design the safety product:
In the operation of studying and developing the products, the unchanged principle
of Vinamilk is to assure the formula of the products, the component of the raw materials,
design of the shape, product bags meet the best safety for the consumers. Vinamilk does
not use the components affecting the health as well as the storing substances.
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