1. TRENDS
IN BUSINESS ENVIRONMENT
AND MANAGEMENT TOOLS
UNIT 01
NGO QUY NHAM
Foreign Trade University
E: quynham@gmail.com
Web: www.ngoquynham.net
Module: Emerging Issues in Management
2. CONTENT
v Changes in business environment in Vietnam
v PEST Analysis for Vietnam
v Top trends concerned by global CEOs
v Management tools and trends
3. CHANGES IN BUSINESS
ENVIRONMENT IN VIETNAM
v Joining FTA, CPTPP
v Changes in market regulation (eg. SOEs)
v Digital transformation
v Climate change
4. FTA COMMON CHARACTERISTICS
AND IMPACTS
v The aim of a free-trade area is to reduce barriers
to exchange so that trade can grow as a result of
specialisation, division of labour, and most
importantly via comparative advantage
5. FREE TRADE AGREEMENTS
BY VIETNAM
SIGNED AND IN EFFECT
v ASEAN Free Trade Area
v Trans-Pacific Partnership (CPTPP)
v Viet Nam-European FTA
v R.Korea-Viet Nam FTA
v ASEAN-Australia and New Zealand FTA
v ASEAN-India Comprehensive Economic
Cooperation Agreement
v ASEAN-Japan Comprehensive Economic
Partnership
v ASEAN-People's Republic of China
Comprehensive Economic Cooperation
Agreement
v ASEAN-[Republic of] Korea
Comprehensive Economic Cooperation
Agreement
v Chile-Viet Nam FTA
v Japan-Viet Nam Economic Partnership
Agreement
NEGOTIATIONS LAUNCHED
²ASEAN-EU FTA
²ASEAN-Hong Kong, China FTA
²Regional Comprehensive
Economic Partnership
²Viet Nam-Customs Union of
Russia, Belarus, and
Kazakhstan FTA
8. SPECIFIC AREAS IN THE
AGREEMENT:
v Goods market access
v Services market access
v Labour
v Environment
v Protections
v Pharmaceuticals
v Investment and ISDS (investor-state dispute settlement)
v Government procurement
v Intellectual property
v Trade facilitation
v State-owned enterprises
9. BENEFITS OF CPTPP
v More exports from producers
v More imports of consumer goods and commodity
v More FDIs as a result of higher confidence
v Boost GDP of Vietnam
v Improve productivity and sustained growth
v Improve the linkage of international supply chain
v Established new trade and investment standards
10. CHALLENGES OF CTPP (AND
ALSO FTA)
v More competition both in product market and input
market.
v Big question: Does Vietnam have comparative
advantage and where?
²The theory of comparative advantage argues that in an
unrestricted marketplace (in equilibrium) each source of
production will tend to specialize in that activity where it has
comparative (rather than absolute) advantage.
14. KEY ISSUES FACED BY
ENTERPRISES IN VIETNAM
Source: Global Competitiveness Report 2017-2018, World Economic Forum
15. ECONOMIC FACTORS:
STAGE OF DEVELOPMENT
v The economy is still in
the beginning stage of
development.
v Vietnam outperform
many key factors in
comparison with those of
emerging and developing
Asian economies , except
for Business
sophistication,
innovation, institution
and infrastructure and
financial market
development.
17. SUMMARY OF PEST ANALYSIS FOR VIETNAM
SMEs
Political & Legal
• Political stability
• New Enterprise Law 2015 come into
effect: break-through mindset
• Vietnam involved in conflict with
China in South China Sea
• New AFTA with EU, S.Korea,
promising TPP
Socio-cultural Factors
• Large market (90.5M)
• Improving standard of education
• Young population (35% under 35)
but skills and productivity is still
low (education, culture)
• Increased middle class (30m)
• Positive entrepreneurship and start-
ups
Economic Factors
• Good GDP growth
• Controlled Inflation
• Stable & reasonable Interest rate
• Low Unemployment (2-4%)
• Slow reform and restructuring of
Banking systems
• Increased budget deficit and public
debt
• Poor Transportation Infrastructure
Technological Factors
• IT advancement
• Low investment on R&D
18.
19. TOP TRENDS CONCERNED
BY GLOBAL CEOS
2014-2015
1. Seeking growth and
accelerating innovation in
a changing business
climate
2. Cost and excessive
complexity are a worrying
barrier to growth
3. Investing in the digital
transformation
4. Understanding customers
2018-19
Trend 1: Backlash against
bureaucracy and complexity
Trend 2: Making the most of
digital technology
Trend 3: Developing a strong
corporate culture
Trend 4: Focus on customers
Trend 5: Watching costs at a
time of growth
Source: Bain.com
20. TOP TRENDS CONCERNED
BY GLOBAL CEOS
v Seeking growth and accelerating innovation in a
changing business climate
² revenue growth is ranked top priority in 2015
² Companies place greater emphasis on innovation and
long-term growth capabilities
²Companies may also be turning to innovation in response
to declining customer loyalty.
Source: Bain.com
21. TOP TRENDS CONCERNED
BY GLOBAL CEOS
v Cost and excessive complexity are a worrying
barrier to growth
Executives (60%) said excessive complexity (globalization) is
raising their costs and hindering growth.
Why?
²excessive layers of management,
²fuzzy decision making,
²matrix structures
²and an exponential increase in communications
à all of which weaken growth and profits.
Source: Bain.com
22. TOP TRENDS CONCERNED
BY GLOBAL CEOS
v Investing in the digital
transformation trend
to support growth and
innovation, master
complexity, and
confront risks
23. TOP TRENDS CONCERNED
BY GLOBAL CEOS
v Investing in the digital transformation trend to
support growth and innovation, master complexity,
and confront risks
² Companies may increase investment in IT (SMAC): increased
sales, better supply chain management; increasing customer
loyalty.
²identify new markets
²improve data security in an era of growing risks and volatility.
²concerns about cyber attacks
Source: Bain.com
24. TOP TRENDS CONCERNED
BY GLOBAL CEOS
v Understanding customers
² improving customer loyalty can help raise revenue and profits
² customers are less loyal to brands than they used to be
² insufficient consumer insight is hurting their performance
29. CONTENT OF THE COURSE
1. Key trends in business environment and
contemporary issues in management
2. Strategic Change Management
3. TQM and Business Process Reengineering
4. MBO & Balanced scorecard
5. Digital Transformation
6. Agile Management
