Dr. Micheal Porter in Vietnam

DR. MICHEAL PORTER IN VIETNAM

Basic question when thinking about company’s strategy is “How do you think about the company role?” The typical way to think about competition is to compete to be the best in what you do. This is the dangerous thinking because if you are in one specific business yield, you find that there is no best company. And you make mistake if you think that there is only 1 way to compete in your industry. The challenge is not to be the best but how to be unique. You have to bring out what your competitors do not have.

=> Vietnamese companies have to learn to develop its unique.

Three mistakes when defining “strategy”:

- Confuse between strategies with some typical steps. It is the place in the market that you want to achieve and how you do to be different, not detail action steps to do.

- Strategy is different from goal and vision. It is your detailed competitive advantage, not some broad statement.

- Good strategy starts with setting up an optimal budget plan. The first important is to increase profit earned on capital, not to grow (developing countries often make mistake between the order of them).

How to create a good strategy? It involved with 5 fundamental principles:

- Provide typical value to customers. It is the answer of 3 questions: What customers do you want to serve?, Which needs of these customers do you want to meet?, and What is your price?. If you provide customers the same with your competitors so you do not have strategy. You have to be unique.

- Adjusting according to customers tastes.

- Define specifically what not to do.

- Activities in your business must fit together.

- The strategy should have continuity. You have to follow and stick to the stategy over and up. A good strategy often works in at least 3 years. It is the time that makes your strategy meaning.

Priority of Vietnam:

- Against corruption.

- Companies equalization.

- Develop financial market.

- Being on time.