I.

Introduction:
When we want to take a business plan put into operation, we need to have a plan about business
strategy. Business strategy plays a very important role in determining the success of the project.
It will increase the chances of success, help reduce unnecessary risks when performing the
project. In my assignment, I will show a report about knowledge of strategic planning includes
example for each task by solving 3 tasks:
-Assess how business missions, visions, objectives, goals and core competencies inform strategic
planning.
-Analysis the factors that have to be considered when formulating strategic plans.
-Evaluate the effectiveness of techniques used when developing strategic business plans
And this assignment, I will give example about Traphaco company, to clear the above task.
Traphaco is a vertically-integrated pharmaceutical company specializing in the development,
marketing and distribution of Vietnamese traditional medicines. The company is the clear leader
in the Vietnamese traditional medicine sector and the second largest pharmaceutical
manufacturer in Vietnam in terms of revenue and net profit. The company owns a strong brand, 2
GMP-WHO manufacturing factories and a nationwide distribution network, with 22 distribution
branches. (Mekongcapital)

II.Analysis:
LO1 Understand the process of strategic planning
1.1 Assess how business missions, visions, objectives, goals and core
competencies inform strategic planning:
a, Compare and discuss the differences among mission, vision, objective, goal and core
competence.

Definition
Missions Statement of business.
States the business reason for the
organization's existence. Does not
state an outcome. Contains no time
limit or measurement. Provides basis
for decisions on resource allocation
and appropriate objectives. Defines
current and future business in terms
of product, score, customer, reason,
and market price. (cocreatr)
Visions Dream or a picture to be achieved
Traphaco
Missions of Traphaco:
- Dedication to society products - services
epochal and rich traditional values in order to
improve the quality of life.
- Always satisfy customer needs, to create
meaningful work and advancement
opportunities for employees.
- Increase the value to investors.
Vision to the year 2020 become a strong

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 ultimately.Created by consensus.
Forms mental image of future to
which people can align. Describes
something possible, not necessarily
predictable. Provides direction and
focus. Pulls people, who hold it,
towards it. (cocreatr)
Goals Results to be achieved.
Describes ideal states to be achieved
at some unidentified future time.
Defined consistent with and related
directly to vision and mission. Guide
everyday decisions and actions. Do
not necessarily deal with measurable
results. (cocreatr)
Objectives How - Actions and Results - to plan
to achieve the desired results.
Focuses on critical organization
issues and milestones. Describe
activities to be accomplished to
achieve goals. Identify dates when
specific results are to be
accomplished. Measurable in terms
of whether or not they are achieved.
They may be changed when
necessary for progress towards goals.
(cocreatr)
economic corporation involved in trading
and providing health care products and
services and owned the capacity in
researching and developing natural hi-tech
products. (Traphaco)
Goals of Traphaco:
Investment in development of enterprise
resources: human, material and financial
resources. Take advantage of the
opportunities, advantages, limitations and
difficulties, maintain and expand the
domestic market for traditional products and
new products. Enhanced promotion,
branding, brand retention leading
pharmaceutical Vietnam.
-Traphaco will develop a team of
international expertise, built upon a local
core culture, which takes pride in the quality
of their products and their contribution to the
health of the community.
-Traphaco will have 4 manufacturing
factories, 1 global distribution network, 1
research and development institute, 1
medical and pharmaceutical vocational
training facility, and 1 health service center.
From that short term, Traphaco has some
result:
Since the Fund first invested in Traphaco, the
company has achieved a consistently high net
profit annual growth rate of 23%. Traphaco
has also aggressively expanded its
distribution network through increasing the
number of branches from 4 to 22. At the
same time, Traphaco also acquired a majority
stake in CNC, the partially-owned
manufacturing subsidiary, which was also the
major source of corporate governance
2

Core Is understood as the probability that
competencie businesses can do well, but must
s simultaneously satisfy three
conditions:
- The possibility that the benefit to
the customer;
- The possibility that competitors are
difficult to imitate;
- You can use this ability to expand
the range of products and markets.
(cocreatr)
concerns and major stakes in two formerly
state-owned provincial distributors.
(Mekongcapital)
With Traphaco company:
-Quality products and services determine the
existence of the business.
- Adding value to society, customers,
employees and shareholders is the goal and
the dynamics of sustainable development.
- Labor creativity is the cornerstone of the
development.
- The cooperation, sharing, commitment and
commitment is the foundation of corporate
culture.
- Age and traditional identity TRAPHACO.

b, How are they related to strategic planning?

Strategic planning is important for any organization. A clear understanding of the process of
strategic planning is crucial for successful implementation of the same. This assignment focuses
on mission, vision, objectives, goals and core competencies of Traphacocompany, issues
involved in strategic planning.

Strategic plans defined the direction of all other plans and they must have characteristics: long
term, base on clear mission, comprehensive and last, developed and controlled by top
management (Business Essentials, chapter 6 -The planning framework).According to this
definition, the strategy has long-term direction of achieving goals.First of all, we need to care
about what the company is, what they want to be, want to become. So the first step, we can
identify the gap of company, so it can pick out a suitable strategy. Therefore, factor mission equal
with a clear mission really necessary to be able to choose strategies. And with a complete plan,
not without clear vision and objective, to that, managers can control the elements appropriately,
to be able to achieve goals. With objective, we need interested factors such as: human resources,
material and financial resources. The company should pay special attention to human resources,
as this is the most important factor in the success of a project.Finally, we need to pay attention to
corecompetancies, to determine whether the plan, the possibility that the benefit to the customer;
related to competition, expanding the range of products and markets.

*Factors affect to strategic planning

All businesses have an environment inside and outside.
- Internal environment is very much related to the human resources of a business or
organization, and the way in which people perform the work in accordance with the
organization's mission. To some extent, the internal environment can be controlled and changed

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through the process of planning and management. Factors in the internal environment, such as:
Human resource, organisational culture, organisation structure, management, assets, financial
strength. (leoisaac)
- Externalenvironment,can not be controlled. The manager of a business does not control
business competitors, or changes in the law, or general economic conditions. However, the
manager of a business or organization has a number of measures to control businesses react to
changes in its external environment. Factors in the external environment, such as: Economic
conditions, market (competition), technology, climate change, legal, media, political,
demographic. (leoisaac)

1.2 Analyse the factors that have to be considered when formulating

strategic plans:
What are the steps and issues/factors of strategic planning?

Stage Comment Key tools, models, Example

techniques

Step 1 Mission/ vision Is answer for Mission of Mission of Traphaco: to

question: why statement the year 2020 become a
does the strong economic
organization corporation involved in
exist? trading and providing
health care products and
services and owned the
capacity
Step 2 Goals Interpret the In this step we need Traphaco is one company
mission to to analysis bring brand of tradition
different stakeholder medicine .Enhanced
stakeholder therefore set goal to promotion, branding,
approach the need brand retention leading
of different pharmaceutical Vietnam.
stakeholder.
Step 3 Objectives Quantified If mission just set .Traphaco will develop a
embodiments of purpose of team of international
mission. organization, in expertise, built upon a
objective will show local core culture,
more clearly about advanced in the world
profitability, time market
scale of strategic

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 planning.
Step 4 Environment Opportunities In this step we can Opportunity:
analysis and threats use PEST analysis, - Pharmaceutical industry
5 forces analysis of has great potential to
Porter to evaluate grow, the rate of
the opportunities traditional medicine
and threats of consumption is forecast
organization, to continue to grow
further in the coming
years.
- Participation in export
markets. The time rate of
Traphaco export sales
accounted for less than
1%. The company is
actively promoting
exports to ASEAN
countries.

Threats:
- East pharmaceutical
market increasingly
fierce competition.
Typical products of the
company are faced with
counterfeit goods, pirated
goods.
- Price subject to strict
control from the state
agency, price growth has
not kept pace input costs.

Step 5 Position audit Identify -Resources Strengths:

or situation strengths and -Value chain - Owning a leading brand
analysis weakness -Product life cycle of traditional medicine
-Boston matrix with a high level of
-Directional policy awareness.
matrix - Infrastructure, modern
-Marketing audit equipment with 2
-Market share factories GMP-WHO.
- R & D activity is strong

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 competitive advantage
biggest Traphaco. Annual
revenue from new
products are accounted
for 7% of total revenue.
- Distribution System No.
2 with pharmaceutical
companies listed
throughout the country.
- Use 80% of inputs are
the ingredients in water.

Weaknesses:
Raw materials companies
grow only about 30% of
raw materials for
pharmaceutical products
China, on the other hand
most of the raw materials
to produce Tan
pharmaceutical imports.
Step 6 Corporate Combine step 4 Therefore we can Traphaco can rely on the
appraisal &5 analysis the strengths, opportunities ...
SWOST analysis to to be able to optimize
see advantage and profits for businesses.
disadvantage of the Especially in the context
organization of the volatile market
today. It can be used to
analyze SWOST,
launched one of the
strategies to help
businesses achieve short
and long term goals.
- The strategy suggested
as SO: streng used to
optimize the
opportunities available;
ST: streng used to limit
the challenges businesses
face.
Step 7 Gap analysis Compare Gap analysis To achieve the objectives

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 outcome of step of step 3, Traphaco have
6 with step 3 to try a lot to adapt with
market in world.Enhance
and promote the
recruitment of high
quality search quality
human resources for the
company, long-term
dedication and loyalty.

=>So, to achieve the objects, to achieve that objectives, the factors inside and outside will affect
the success of that objectives. But external factors accounting for more factors, when trying to
reach Traphaco than on world market.

1.3 Evaluate the effectiveness of techniques used when developing strategic

business plans:
-Boxton Matrix (Boston Consulting Group): It focus on product to give strategy.
Resources are allocated to the business units according to their situation on the grid. The four
cells of this matrix have been called as stars, cash cows, question marks and dogs. Each of these
cells represents a particular type of business.

10 x 1x 0.1 x

(http://www.managementstudyguide.com/bcg-matrix.htm )

Limitations of BCG Matrix

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The BCG Matrix produces a framework for allocating resources among different business units
and makes it possible to compare many business units at a glance. But BCG Matrix is not free
from limitations, such as:
- BCG matrix classifies businesses as low and high, but generally businesses can be medium
also. Thus, the true nature of business may not be reflected.
- Market is not clearly defined in this model.
- High market share does not always leads to high profits. There are high costs also involved
with high market share.
- Growth rate and relative market share are not the only indicators of profitability. This model
ignores and overlooks other indicators of profitability.
- At times, dogs may help other businesses in gaining competitive advantage. They can earn even
more than cash cows sometimes.
- This four-celled approach is considered as to be too simplistic.
(managementstudyguide)
=>With Traphaco, Vision to the year 2020 become a strong economic corporation involved in
trading and providing health care products and services and owned the capacity in researching
and developing natural hi-tech products. So, Traphaco take care for their products and services.
=>Traphaco should choose BCG to give business strategy.

-SPACE(Strategic Position and Action Evaluation): focus on position of company to give

strategy.
SPACE can be used in the second stage of the strategic planning process. This matrix corporate
strategic choices attacks cautious / conservative defense or competition. The axis of the SPACE
matrix represent 2 internal factors the organization and two external factors.

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(http://www.mba-tutorials.com/wp-content/uploads/2010/12/image1.png )

Disadvantage :It hard for companies control external factors of environment like the changing of
policy of government or competitor is a lot in large market share.

-Directional policy matrices: more focus on product too like Boston Matrix but more detail and
clearly.

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(http://www.brs-inc.com/models/model18.asp )
With this matrix measures the health of the market and your strength to pursue it. The results
indicate the direction for future investment. It has advantages, such as:
- Help business build a business structure and optimal balance .
- Figure out how to use financial resources in order to maximize the business structure of a
business .
On other hand, it also has disadvantages:
assess the development potential based on market share and growth of the business sector is
incomplete .

-PIMS (Profit impact of market share) this indicates a positive relationship between market
share and profitability.
PIMS seeks to address three basic questions:
- What is the typical profit rate for each type of business?
- Given current strategies in a company, what are the future operating results likely to be?
- What strategies are likely to help improve future operating results?

=>With Traphaco, problems about customer also need taken care.

We should choose this, because it as appropriate with the objectives.

Conclusion, with the objectives mentioned in task 1.1 , 1.2 , should we choose BCG , PIMS is
the appropriate method to evaluate the company's strategy

III. Conclusion:
In conclusion, company have to defied clearly the mission, vision, goal or objective, core
competence, to be able toeasier develop allow the purpose. On the other hand, they helpful for
selected strategic planning model. It is very necessary to find out and understand strategic

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planning to apply to the business in the future.

Bibliography
cocreatr. (n.d.). http://cocreatr.typepad.com. Retrieved from
http://cocreatr.typepad.com/everyone_is_a_beginner_or/2012/04/defining-vision-
mission-goals-and-objectives.html

leoisaac. (n.d.). leoisaac.com. Retrieved 2015, from

http://www.leoisaac.com/planning/strat016.htm

managementstudyguide. (n.d.). http://www.managementstudyguide.com. Retrieved

from http://www.managementstudyguide.com/bcg-matrix.htm

Mekongcapital. (n.d.). Mekongcapital. Retrieved 2015, from

http://www.mekongcapital.com/en/content/traphaco

Traphaco. (n.d.). Traphaco. Retrieved from

http://www.traphaco.com.vn/en/introduction/overview

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