UNIVERSITY OF TECHNOLOGY MARA JOHOR

SEGAMAT CAMPUS

BACHELOR IN BUSINESS ADMINTRATION (HONS) IN

(MARKETING)

STRATEGIC MARKETING MANAGEMENT

MGT 652
MAJOR ASSINGMENT:
MARKETING PLAN
Perusahaan Automobile National Bhd. (PROTON)

Prepared For:
PM MOHD ZAINAL BIN LODE

PREPARED BY:

YANG IZHANI BINTI ITHNIN 2006211286

AHMAD AKMAL BIN MOHHID 2005655098
MOHD AKIB BIN MOHD ZIN 2005655066
MUHAMAD ZULHANIF BIN BAHARUDDIN 2005655041
AZMI BIN MOHD NOOR 2006848206

CLASS: BMB5M1
SUMMITED DATE: 11TH April 2008

1
DECLARATION OF ORIGINAL WORK

BACHELOR OF BUSINESS MANAGEMENT (MARKETING)

FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA
JOHOR CAMPUS

“DECLARATION OF ORIGINAL WORK”

Hereby, declare that,

 This work has not previously been accepted in substance for any degree
program locally or overseas and is not being concurrently submitted for
this degree program or any other degree program.

 This project paper is the result of our independent work and investigation,
except where otherwise stated.

 All verbatim extract have been distinguish by quotation marks and sources
of our information have been specifically acknowledged.

Signature: _______________ Date: ___________

1. YANG IZHANI BINTI ITHNIN 2006211286
2. AHMAD AKMAL BIN MOHHID 2005655098
3. MOHD AKIB BIN MOHD ZIN 2005655066
4. MUHAMAD ZULHANIF BIN BAHARUDDIN 2005655041
5. AZMI BIN MOHD NOOR 2006848206

2
ACKNOWLEDGEMENT

In the journey making this report they are many difficulty and best moment in our
life. Friends and lecture all of them play a part in this report. It is our pleasure to
say something for all the effort from the group members and others.

First of all, we would like thank and praise to Allah S.W.T. The Al-Mighty and
Merciful because give us an opportunity to complete this project paper in time.
Without the grace and help from Him, it is impossible for us to have greater
endurance, courage and spirit in order to complete this project paper.

We would also like to thank our advisor, PM Mohd Zainal Bin Lode who has
constantly guide, encourage and advise us during the completion to this project
paper.

We would also like to thank to all friends, especially to our classmate in BMB5M1
and everybody who help us directly or indirectly in completing this project paper.
Special thanks also to the librarian of UiTM Johor campus, for their cooperation
and help throughout the success of this study.

We would be forever thankful to them. Only the Allah can replay them

Thank you,

3
TABLE OF CONTENTS
Declaration of Original Works i
Acknowledgement ii
Table of Contents iii
Executive Summary Latter iv
1. Company Background 1-2
2. Proton Vision And Mission 3
3. Proton Existing Objectives 4
4. Proton Strategies 5-6
5. SWOT Framework 7-10
6. SWOT Matrix for Proton 11-14
7. Financial Ratio Analysis of Proton 15-19
8. BCG Matrix (Boston Consulting Group) 20
9. The Internal-External (IE) Matrix 21
10. Long Term Objective 22
11. Recommendation 23-25
12. Time Phase Plan 26
13. Cost Estimates for Recommendation 27-28
14. Conclusion 29
15. Reference 30-32
16. Appendix

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Executive Summary Letter

By study of Strategic Marketing Management, we are enabling as marketers to

understanding and predict the real situation in the developing the marketing plan.
It also concerned not only with what company strategic plan but also with why,
when, where, how and how often they used it in selling their product. At the end
to give clear view to inform the potential customer to notice about product line
and mix and at the end will buy, used and loyalty with the product and the
company for long term period.

The field of the report is rooted in the marketing plan and the strategic objective
for Proton Berhad. to selling and distributing the variety of the product brand in
Malaysia. Next, in this report we will determine such the marketing strategy,
SWOT analysis that determined the competition position, the variety product and
the key of success in their marketing strategy.

In created and understanding Mission better, the third segment we will focus on
the organization external opportunities by critical analysis with Proton Bhd
marketing objective, target market, positioning and marketing research and mix.
Understand Proton Bhd strategic in financial analysis also be include in this
report. And in last segment we will go throw recommendation and conclusion that
we have learn by adoption the theory in the subject with the Proton Bhd
Marketing Plan.

We hope that this executive summary give you better understanding about our
report and please enjoy our research on Marketing Plan by Proton Bhd

5
1.0 BACKGROUND OF THE COMPANY

PROTON was incorporated on 7 May 1983 with three primary national policy
objectives: to spearhead the development of component manufacturing
industries, to acquire and upgrade technology and industrial skills within the
automotive manufacturing industry and to strengthen the international
competitiveness of Malaysia’s industrial capability.

Today, PROTON is the clear market leader of the Malaysian automotive industry
with the largest domestic market share and a distribution network that spans the
globe. The business of the Group has been expanded to include engineering
consultancy, manufacturing, distribution, financial services and property
investment. With a turnover exceeding RM10 billion in 2002, it is one of the
largest companies listed on the Bursa Malaysia Berhad.

The Group design and produces cars for diverse consumer preferences.
PROTON portfolio includes the world-renown sports cars Lotus Elise and Lotus
Esprit, the sporty Satria Gti, the stylish Gen.2 and the versatile Jumbuck. These
cars are manufactured in Malaysia and UK. The Group also has manufacturing
joint ventures in Vietnam, China and Indonesia.

The engineering consultancy business is led by PROTON wholly owned

subsidiary, Lotus Group, which has offices in the UK, USA, Malaysia, China and
Germany. Lotus Group is a leading sports car manufacturer and engineering
services consultancy with numerous international awards for innovation and
design including the Sir Henry Royce Award for engineering excellence.

The Group conducts research in its centers in the UK and Malaysia for new
technologies with the ultimate aim top put these innovations into production
through partnership with Tier One Suppliers or OEM customers. A number of
these patents have been licensed to leading car manufacturers.

6
Currently, the Group has almost 10000 employees who are involved in the whole
spectrum of the business from research, design, development, testing, stamping,
casting, machining, and assembly to marketing, distribution and after-sales.

Strong customer orientation and competitively priced products are the foundation
of the business and essential to the success. Proton aim to maintaining the
market leadership by continuing to develop innovative products and satisfying the
customers better and more profitably than the competitors.

7
2.0 PROTON’S VISION AND MISSION

2.1 Vision
To become a successful Malaysian automotive engineering and manufacturing
company globally by being customer oriented and producing competitively priced
and innovative products.

2.2 Missions
2.2.1 To Customer
PROTON strives to deliver total customer satisfaction through the provision of
quality automobiles and related products and services more efficiently and
effectively than the competitors.

2.2.2 To Shareholder
PROTON strives to generate good earning with steady growth through the
efficient management of resources.

2.2.3 To Employees
PROTON is committed to promote a conducive working environment while
focusing on human resource development and long-term employment.

2.2.4 To Business Associate

PROTON strives to develop and maintain mutually-beneficial, value-added
relationship of the highest degree.

2.2.5 To Nation
PROTON shall be a responsible corporate citizen and shall be the impetus
towards the realization of Vision 2020.

8
3.0 PROTON’S EXISTING OBJECTIVES

1. Produce excellent products and services to conduct business and expand

to enhance returns.
2. To seek new opportunities to add value to the business with investment
from local and foreign investors.
3. Enhance corporate culture and align corporate goals with the interest of
shareholders and other stakeholders.
4. Drive a success as a transparent, accountable and ethical organization.

9
4.0 PROTON’S STRATEGIES
Product and Services
I. Customer orientation product and services.
II. Developing new innovative product features.

Research and Development

I. Conduct projects through collaboration with Malaysian and UK
universities with some funding provided by the Malaysian government.
II. Development of new low cost flexible engine.
III. Development on an aluminum-bodied vehicle and increased fuel
efficiency.

Manufacturing
I. Flexible manufacturing system installed to changing customer demand
with faster changeover of models.
II. Joint venture plant with other countries such as Indonesia and
Vietnam.

Quality Management
I. Adopt three-stage line inspection – 1. Static evaluation on fitting and
appearance exterior and interior cars. 2. Dynamic evaluation on
function and drivability. 3. Final inspection before approved fit for
delivery to customers.
II. Vendor quality addressed at source by using Advance Product Quality
Planning (APQP) teams.

10
Sales and Distribution
I. Strengthening of domestic sales and service network to improve
customer service and maintain market share.
II. Launched Customer Management Center known as “Proton I.Care” for
customer to contact with Proton Edar for product and service enquiry
as well as 24 hours emergency breakdown assist.
III. International expansion plants and distributors to oversea countries
such as Middle East countries, Australia, United Kingdom, Indonesia
and Singapore.
Shareholders
I. Investor relations program involves the participation of the Board and
senior management.

Business Associate
I. Over 100 Malaysian manufacturers were appointed as Simultaneous
Engineering Partners in development of new range of products.
II. Select alliance opportunities that enable to deliver better ideas into
market place include Asian, European, North America and South
American companies.
III. Formed a joint venture with Miyazu of Japan to develop Malaysian
capabilities in die design, manufacturing and maintenance.

Human Resources
I. Recruit, reward and retain the best employees.
II. Internship program for graduate trainees’ implementation.
III. Development communication of policies affecting employees.

11
5.0 SWOT FRAMEWORK

5.1 Opportunities

1. China economy is growing faster after they had opened their

market to foreign company. China is a big market for
automobile industry.

2. Increase demand for cars in developing countries as it

becomes a necessity and part of modern lifestyle especially
in ASIA country.

3. Increase demand because of high marriage rate in ASEAN

region and new family is seeking cars for their daily usage.

4. New technology such biodiesel, hybrid cars, hydrogen as

alternative fuel and more efficient cars had create new
demand in automobile industry.

5. Implementation of AFTA (Asian Free Trade Area) and

liberalization with United States and Europe country had
establish new market segment internationally to be serve.

12
5.2 Threats
1. The increase of oil price up to US68 per barrel had slow the
growth of automobile industry.

2. Intense price competition among the car manufacturer had

push up higher quality level and competitiveness of each
new car model been produces.

3. The increase of steel price had increase cost of production

and minimizes profit gained by manufacturer.

4. Well establish car makers had launch hybrid car and

sophisticated car that use fuel economically thus reducing
demand for ordinary types of cars.

5. Most of Resources, Distribution network, High Technology,

Brand Preference, International market share and
engineering expertise is own by foreign car makers.

13
5.3 Strengths

1. Proton is a market leader in domestic market and acquire up

to 70% of market share of car sales in Malaysia.

2. Proton has develop the engineering expertise, own engine

and own manufacturing and research and development
platform through the years.

3. Proton had own Lotus engineering expertise who is a leader

in sport car segment worldwide thus increase proton
reputation and ability to compete in global market.

4. Proton own Proton city at Tanjung Malim (2004) which is an

integrated information city, super high speed networking,
smart homes, and sophisticated e-commerce thus possess
the ability to design, test, produce and market cars from the
scratch.

5. Proton business including providing engineering consultancy,

manufacturing, distribution, financial services and property
investment worldwide.

6. Proton own manufacturing facilities in Malaysia, United

Kingdom, Vietnam, China and Indonesia.

14
5.4 Weaknesses

1. Image projected by Proton is perceive as ordinary brand not

exclusive brand (in term of quality of cars been produced)
especially in domestic market.

2. Proton car not popular in international market because of

Proton’s lack of networking, aggressive marketing and brand
power advertising campaign.

3. Lack of high quality car model thus lowered its brand power
and less competitive with foreign car maker such Honda,
BMW and Hyundai.

4. Bureaucratic and ‘play it safe’ management style had hold

Proton potential and performance from becoming sensitive
towards the shift of customer wants and competitors new
technology and new car model thus decrease its domestic
market share.

15
6.0 SWOT MATRIX FOR PROTON
STRENGTH WEAKNESS
1. Proton is a market leader in 1. Low Brand Power and Brand
domestic market. Image.
2. High Engineering expertise, own 2. Lack of networking, aggressive
engine and manufacturing and R&D. marketing and brand
3. Own Lotus engineering expertise advertising campaign.
thus increase its reputation and 3. Lack of high quality car model
ability to compete in global market. thus lowered its brand power.
4. Owned Proton city at Tanjung Malim 4. Bureaucratic and ‘play it safe’
(2004) thus possess the ability to management style.
design, test, produce and market
cars from the scratch.
5. Operate in Engineering consultancy,
manufacturing, distribution, financial
services and property investment
worldwide.
6. Owned plant in Malaysia, United
Kingdom, Vietnam, China and
Indonesia.

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OPPORTUNITY
1. China economy growth and
large populations.
2. Owning cars in developing
countries becomes a
necessity and part of
modern lifestyle especially
in ASIA country.
3. High marriage rate in
ASEAN region and new
family is seeking cars for
their daily usage.
4. New technology such
biodiesel, hybrid cars,
hydrogen as alternative fuel
and more efficient cars had
create new demand.
SO – STRATEGY
1. Developing high technology,
sophisticated and exclusive cars
applying hybrid system, using
biodiesel fuel and economical fuel
consumptions. (S1,S2,S3,O4)
2. Focusing in China Market and other
developed country, establish brand
power and produce more cars that
suit foreign customer needs and
wants. (S6,O1,O2,O5)
WO – STRATEGY
1. Developing new car models
that high quality and unique
design and sell at affordable
price. (W1,W3,O2,O3)
2. Penetrating new market in
developed countries where
price sensitive is high and sell
cars at premium price to
Establish Market Share.
(W3,O2,O3)
17
 5. Implementation of AFTA
(Asian Free Trade Area)
and liberalization with
United States and Europe
country.
THREAT
1. The increase of oil price up
to US68 per barrel.
2. Intense price competition
among the car
manufacturer.
3. The increase of steel price
had increase cost of
production and minimizes
profit.
4. New Hybrid car and
sophisticated car that fuel
economically thus reducing
demand for ordinary types
of cars.
ST – STRATEGY
1. Develop and produce cars that
economical fuel consumptions, high
performance engine, nice design
and giving more added value to
customers. (S3,S4,S5,T1,T4)
2. Outsourcing Proton expertise,
operations and networking through
joint venture, acquisitions and
strategic alliances. (S3,S4,S5,T2,T5)
WT – STRATEGY
1. Establish strategic alliances
with global player in automobile
industry to increase the
distribution channel, marketing
ability and R&D capacity.
(W2,T2,T5)
2. Applying cost leadership
strategy in management and
productions by using new
technology and methods.
(W3,W4,T1,T2,T3)
18
5. Resources, Distribution
network, High Technology,
Brand Preference, market
share, engineering
expertise is own by foreign
car makers.

19
7.0 FINANCIAL RATIO ANALYSIS OF PROTON
RATIO 2007 2006
LIQUIDITY RATIO

1) CURRENT RATIO RM3,502,203 RM4,352,605

RM1,533,075 RM1,908,142
Current Asset
Current Liability = 2.28 times = 2.28 times

2) QUICK RATIO RM3,502,203 – RM4,352,605 -RM372,458

RM374,149 RM1,908,142
Current Asset – Inventory RM1,533,075
Current Liability = 2.09 times
= 2.04 times
LEVERAGE RATIO

1) DEBT TO TOTAL ASSET RM1,703,001 RM 2,130,410

RATIO RM6,668,476 RM6,865,855

Total Debt =25.54% =31.02%

Total Asset

2) DEBT TO EQUITY RATIO RM1,703,001 RM2,130,410

RM4,965,475 RM4,735,445
Total Debt
Total Stockholder Equity =34.30% = 44.99%

3) LONG TERM DEBT TO RM169,926 RM222,268

EQUITY RM4,965,475 RM4,735,445

Long Term Debt =3.42% = 4.69%

Total Stockholder Equity

4) TIMES INTEREST EARNED RM344,174 RM946,598

RATIO RM14,604 RM12,565

Profit Before Interest and Taxes = 23.57 times = 75.34 times

Total Interest Charges

20
ACTIVITY RATIO

1) INVENTORY RATIO RM4,825,658 RM6,466,738

RM374,149 RM372,458
Sales
Inventory =12.90 times = 17.36 times

2) FIXED ASSET TURNOVER RM5,259,781 RM7,674,265

RM3,166,273 RM2,513,250
Sales
Fixed Asset =1.66 times = 3.05 times

3) TOTAL ASSET TURNOVER RM5,259,781 RM7,674,265

RM6,668,476 RM6,865,855
Sales
Total Asset = 0.79 times =1.12 times

4) ACCOUNT RECEIVABLE RM5,259,781 RM7,674,265

TURNOVER RM252,581 RM455,479

Sales = 20.82 =16.85

Account Receivable

5) AVERAGE COLLECTION RM252,581 RM455,479

TURNOVER RM5,259,781/365 RM7,674,265/365 days
days
Account Receivable = 21.66 day
Sales/365 days = 17.53 day

PROFITABILITY RATIO

1) GROSS PROFIT MARGIN RM434,123 RM1,207,257

RM5,259,781 RM7,674,265
Sales – Cost of Goods Sold
Sales = 8.25% = 15.73%

2) OPERATING PROFIT RM329,570 RM934,033

MARGIN RM5,259,781 RM7,674,265
Earnings Before Interest and
Taxes = 6.27% = 12.17%
Sales

3) NET PROFIT MARGIN RM321,836 RM772,286

RM5,259,781 RM7,674,265
Net Income
Sales = 6.12% = 10.06%

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4) RETURN ON TOTAL ASSETS RM321,836 RM772,286
(ROA) RM6,668,476 RM6,865,855

Net Income = 4.83% = 11.25%

Total Asset

5) RETURN OF RM321,836 RM772,286

STOCKHOLDERS RM4,965,475 RM4,735,445
EQUITY (ROE)
= 6.48% = 16.31%
Net Income
Total Stockholders Equity
RM321,836 RM772,286
6) EARNINGS PER SHARE (EPS) RM1,000,000 RM1,000,000

Net Income =RM0.32 per share =RM0,77 per share

Number of Shares of Common

GROWTH RATIO

1) SALES RM5,259,781 -
-Annual percentage growth in RM7,668,748
total RM7,668,748
Sales.
= -31.41%

2) NET INCOME RM321,836 -

- Annual percentage growth in RM772,286
profits. RM772,286

= -58.33%

22
ANALYSIS

Liquidity Ratio
The liquidity ratio is the measure of the overall ability of the firm to meet its
maturing obligation by relying on its current assets, in other words. It measures
the ability of the firm’s liquid resources to pay current and maturity on items. For
current ratio for Proton Holdings Berhad is also same. This indicates that the
ability of the asset to be liquid into cash is same.

Leverage Ratio
Leverage ratio is concern with how much the company owes outsider in relation
to assets value of the company and to the company’s long term capital structure.
Higher borrowing indicates risk because the firm needs to finance the interest
charge imposed on them. As measure in Proton Holdings Berhad financial
statement, the Debt Ratio is decreasing from 31.03% to 25.54%. its show that the
ability of the one unit of total asset to pay the debt is decreasing.

Activity Ratio
Activity ratio use to measure the efficiency of the management in utilizing the
assets of the company as well as managing the overall operation of Proton
Holdings Berhad. The account receivable turnover indicates the ability of this
company stock to be sol is increase from 16.85 times to 20.82 times. This
indicates that the ability of the company to charge its stock over the year is
increasing to 3.97 times per year.

Profitability Ratio
The profitability ratio measure the relative success of the firms that is combine
the effect of liquidity activity and leverage management on the firm’s overall
operating result. It relates to the firm’s ability to obtain returns relative to sales,
assets and equity. Profitability ratio gives an insight into the company policies and
is regarded as an important ratio by the auditors to detect any errors or unusual
fluctuation as due to error of fraud. The Profit Margin, its indicates by the ratio we

23
found out that the Net Profit Margin for Proton Holdings Berhad decrease from
15.73% to 8.25%.

24
 8.0 BCG Matrix (Boston Consulting Group)

RELATIVE MARKET SHARE POSITION

High Medium Low

High 1.00 0.50 0.00
+20
INDUSTRY
SALES
GROWTH
RATE
%

Medium
STAR
II .
Proton QUESTION MARKS
I

CASH COWS DOGS

III IV

Low
-20

ANALYSIS

From our analysis, Proton is in the Question Marks quadrant because Proton
possess low internal market share in the high growth automobile industry.
Division in Quadrant I have a low relative market share position, yet they
compete in a high-growth industry. Generally this firm’ cash needs are high and
their cash generation is low. These businesses are called Question marks
because the organization must decide whether to strengthen them by pursuing
an intense strategy (market penetration, market development or product
development) or to sell them.

25
9.0 THE INTERNAL –EXTERNAL (IE) MATRIX

THE IFE TOTAL WEIGHTED SCORES

STRONG AVERAGE WEAK

3.0 to 4.0 2.0 to 2.99 1.0 to 1.99
4.0
3.0 2.0
1.0

High 1 11 111
3.0 to 4.0

3.0

Medium
2.0 to 1V V V1
2.99

2.0

Low
1.0 to
V11 V111 1X
1.99

1.0

ANALYSIS

The IFE total weighted score on the x-axis and the EFE total weighted scores on
the y-axis for the Proton company are 3.15 and 3.35, so that the prescription for
division falls into cells I,II,IV that can described as grow and build. Intensive
(market penetration, market development and product Development) or
integrative (Backward Integration, forward integration and horizontal integration)
strategies can be most appropriate for these divisions.

26
10.0 LONG TERM OBJECTIVE

1. To implement and strengthen more on the marketing strategies in order to

become world class service manufacturing.

2. To develop more on designing and supporting for component of services

advanced technology.

27
11.0 RECOMMENDATION
Proton has excessive resources, backward, forward or horizontal integration may
be effective strategies. If Proton too heavily committed to a single product, then
concentric diversification may reduce the risks associated with a narrow product
line. Proton can afford to take advantage of external opportunities in several
areas: they can take risk aggressively when necessary.

From our analysis, Proton we recommend the strategies as below: -

11.1 Repositioning

Repositioning can be used to aim diversity away from existing market by

uncovering new applications, uses or market segment for current product.
In Proton situation repositioning means Proton can niches their
segmentation to be more focus and realistic. By using the same objective,
should Proton repositioning their product more toward the middle segment
people? The answer will be yes. Persona is the best example of
repositioning but it limited in long destination to European and China
market. Proton should develop new services that not only capture sub
domestic market but also future market in Middle East such as UAE, Qatar
or Arab Saudi in addition to increasing better image about quality
automobile industry from Asia.

11.1.1 Advantages
By implemented this strategy Proton can achieve as below advantages in
their performance and operation:
 Strategic decisions involving services and product-which product lines
should be continue, which to add and which to delete.
 Can identified and select the potential market in which Proton will have
competitive advantage.
 Such statement of focus can drive the operations of a firm.

28
11.1.2 Disadvantages
By implemented this strategy Proton should also consider several problem
that may occur such as:
 Product and services that provide small and limited growth rate will be not
notice as potential market
 Limitation in terms of management power and financial cost

11.2 New Product Lines or Additional

New product lines means Proton develop such product (1) new to the
provider as opposed to the market place (2) be additional to the product
range already on offer. For example, Proton can provide service such as
van and buses to tack customer from the local transport to airport or
having travel tour in stop destination for customer during the waiting time
in local destination. This develop new lines in Proton service and other
development can Proton done such as selling Insurance cover to the
passenger.

11.2.2.1 Advantages
By implemented this strategy Proton can achieve as below advantages in
their performance and operation:
 It helps in the task of the long term objective
 Differentiation, can be based on product quality, product features,
innovation, service, distribution, or strong brand name
 Lost cost strategies can be based on an experience curve, which links
cost reduction to cumulative production volume, or on other factors such
as no-frills products or automated production processes.
 A preemptive move attempts to generate a “first-mover” advantage.

29
 11.2.2.2 Disadvantages
By implemented this strategy Proton should also consider several problem
that may occur such as:
 Difficult to coordinate various functional are strategies so that Proton don’t
work at cross-purpose.
 Focus strategy will direct its effort toward narrow part of either the product
line or the market.

From our research we had find out that proton had develop engineering
expertise and sophisticated manufacturing facilities and have all the ability to
compete in the global market. Step taken by Proton in buying Lotus Engineering
(leader of sports car industry in the world) is a good strategy in order to boost its
capacity in designing and developing its own technology.

Recent strategy under process is establishing distribution channel world

wide with Volkswagen and other well establish corporation that possess the
ability to market the Proton car worldwide. By 5 years from now we believe that
Proton is able to design, develop, test, produce and market its own cars by using
its own expertise and technology worldwide as Honda and BMW do.

30
12.0 Time Phase Plan

Implementation Phase 1 Phase 2 Phase 3

Who Cooperate Level Functional Level Division Level
When 1 to 3 month 6 Month to 1 1 years to 5 years
years
Control Tools 1. Benchmarking 1. Corrective 1. Benchmarking
2. Budgetary Action 2. Budgetary
Control Control
Evaluation Process The Balanced Effective and The Balanced
Scorecard efficient operation Scorecard
and management
evaluation
Problems 1. Changing the 1. Difficulty to 1.Large numbers
culture of adopt the new of Customers
management culture
2. Huge Area to be
2. Power conflict 2. Conflict with Recover
personal interest
3. Legal and law 3. Longer Time to
Differentiation be Acceptable

4. Pricing not 4. Not satisfied

parallel with quality with the quality
service services

How To Overcome Contingency Contingency Supporting

Planning Planning
Final Results 1. Adopts the 1. Changes by 1. Increasing the
differences Time numbers of sales

2. Reducing 2. Adopts the 2. Position as

Conflict differences number one
company in
3. Adopts the Consumer product
new cultures n more markets

31
13.0 Cost Estimates for Recommendation

In order to adopt product development strategy, which involves introducing the

new or modified services to the present markets, we expect the sales and
marketing expenses increase by 11.27%, property, plant, and equipment
increase by 57.4%, administrative expenses decrease by 41.22%, other
operating expenses increase by 59.54%, investing activities increase by 35.62%,
financing activities increase by 29.3%. Income and expenses for each income
statement are translated at average exchange rates.

The estimated useful lives and residual values of property, plant and equipment
based on factors such as business plan and strategies, expected level of usage,
future technological developments and market prices.

Future results of operations could be materially affected by changes in these

estimates brought about by changes in the factors mentioned. A reduction in the
estimated useful lives and residual values of property, plant and equipment in
particular the residual value of aircraft frames and engines would increase the
recorded depreciation and decrease the property, plant and equipment.

32
 Projected Cost for Automobile Industry
Estimate
Money
Additional Expenditure (RM’000)

Operating activities 250,904

Investing activities 1,575,636

Financing activities 1,140,602

TOTAL AMOUNT 2,967,142

Recommendations for Proton are to enhance its quality of service after sales to
parallel with other automobile from Japan or Korea from aspect safety,
worthiness, technology, and punctuality. Although it provides a cheaper price than
others automobile competitor but more customers not satisfied with their
services. So, Proton must be develop their services to attract and satisfied their
customers.

Another recommendation is Proton should be use a Seven-S Method to improve

their operation system or their structure. Proton also should be done a more
promotion to advertise their services and also image of the company. It can
invest in other country to get higher profit.

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14.0 CONCLUSION

From this study, we can conclude that Proton have a potential in order to perform
well in the global market. With the strengths that they have, they can perform in
the global market if they used all the strengths that they have. Those strengths
can also become competitive advantages to Proton in competing in this industry.
Although there are many competitors for Proton, we believe that Proton can
compete with their competitor effectively with the help of their strengths.

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REFERENCE

Journal and books:

Proton financial statements 30 June 05, 30 June 2007 and 31 December 2007

Christy Harvey, “Greeting lifetime customers”, Customer Relationship

Management, October 2001, page 25-26

Christy Harvey, “Greeting lifetime customers”, Customer Relationship

Management, October 2001, page 25-26

Fred R. Dvid, “Strategic Management Concept and Cases”, Eleventh Edition,

Pearson Education, New Jersey,2007

Kotabe Helsen, “Global Marketing Management” WIJEL, Fourt edition, United

Stated of America, 2008

Lamb, Hair, McDaniel, “Marketing”, Seventh Edition, 2004, page 292-315

Mark Steeling, “An Empirical Analysis of Sponsorship”, Journal of Consumer

Research, June 97

Martin Christopher, Adrian Payne and David Ballantyne, “Relationship Marketing;

Bringing quality, customer service and marketing togethet.” Second Edition,
Butterworth-Heinemann Ltd, Oxford, 1994

Sarah Ellison, “On Cloud Blue”, Operating on the low rate but high frills concept,
Wall Street Journal, 12February 2002

Seelan Sakram and Bhupinder Singh, “All System Go”, A look At Malaysian
General and Commercial Aviation, Asian Economic, February 2004, page 107-
109

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Newspapers and Magazines:

Australia’s Number One Industry Newletter January 2006

Azli Ayob, “Proton tarik balik Savy”, Berita Harian, 3 Mac 2008

David Wolfer, “Proton IPO Price Disappoint”,

Fazailah Ptd dan A Precila Shantini. “Proton kuasai semula pasaran tempatan”
Berita Harian. 7 Mac 2008

Fazli Ayub, “Bank Negara kekal Kadar Faedah” Berita Harian 5 Mac 2008

Francica Tan, “Proton plans entry to automobile in Thailand Market”

Business News, 25 July 2005

Gina Imperto, “Proton in sponsorship deal”, The Star, 22 February 2005

Ismail Jalaluddin, “Proton launches new generation of Saga” The Star, 3 March
2005

Mastura Hamid, “Proton launches persona” New Strait Times, 23 August 2005

Sharizan Salian, “Proton umum tiga lagi kerata baru”, Berita Harian 6 Mac 2008

Tong Gok Chong, “Proton: When the business of doing business comes first”
Malaysian Business, July 2005

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Website:

Financial Report 2005, Mac7 008, 15:00 www.proton.com.sg/financialreport05/

Financial Report 2005, November 2005,14.20

www.proton.com/financialreport05/

KLSE Quates Sorted By Counter, Tuesday, Dec27 05,20.40 www.klse.com.my

KLSE Quates Sorted By Counter, Tuesday, Mac7 08, 14:05, www.klse.com.my

Organizational structure of Proton Company in 2005. 14350,

www.proton.com/investorRelations

37