[Abstract]
Recently the trend of world economy is making a transition from the regional economy to the global economy. This means that the enterprises of world are rushed into the era of the limitless competition through ¡°the principle of the survival of the fittest.¡±
Now world economy is changing into one economy block over the border in the effect of free transfer of production element, the relaxation of tax․xtax-free barrier and the activity of global enterprises.
Therefore world trade is shifting from the simple type exporting domestic goods on foreign market the global type exporting the goods produced in the predominant region without division of domestic and foreign producing center into international market. To meet rapidly the needs of these environment transition, domestic enterprises should construct global management system which can produce and supply the goods meeting the needs of internationally various consumers through the optimal distribution of the limited management resources with the view of globalization.
Since 1980s, our country are faced with the limit of export-centered policy, because our major trading partner such as USA strengthened the import restrictions and weakened rapidly comparative advantage as the producing center. To cope with these environmental change, since the end of 1980s, our country initiated the globalization strategy of ¡®overseas production ¡æ overseas sales¡¯ by an overseas direct investment breaking from exported-centered globalization strategy of ¡®domestic production ¡æ overseas sales.'
To cope actively with changes in the domestic management environment and the international economic environment, many medium and small companies are planning the advance into other countries or already did. In this overseas expansion of medium/small companies, China was the main target in the past ,but recently the advance to Vietnam is booming in the concept to China Plus One. This trend has been accelerated since there-establishment of diplomatic relationship with Vietnamin 1992. Investment into Vietnam, for its part, was concentrated in the materials industry such as textiles and clothing. Over half of Korean investment into each country goes into the manufacturing sector: the majority of investments into Vietnam is received by primary metals and textiles industries. The investment size to Vietnam creased 5times in latest 5years, and thus Vietnam has become the most preferable country of Korean companies.
But, the studies on the Korean companies in Vietnam are so scarce that the companies planning the advance into Vietnam or already advanced companies are suffering many difficulties in establishing the management strategy.
Vietnam¡¯s economic freedom score is 51.3, making its economy the 136th freest in the 2012 Index. Its score is 0.3 point worse than last year, with a notable improvement in trade freedom counterbalanced by lower scores in government spending and monetary freedom. Vietnam is ranked 29th out of 41 countries in the Asia-Pacific region, and its overall score is lower than the world and regional averages.
The Vietnamese economy has registered annual growth rates averaging about 7 percent over the past five years. Capitalizing on its gradual integration into the global trade and investment system, the economy has been transforming itself into a more market-oriented economy. Reforms have included partial privatization of state-owned enterprises, liberalization of the trade regime, and increasing recognition of private property rights.
Nonetheless, institutional weaknesses undermine prospects for more sustained long-term economic development. The foundations of economic freedom remain fragile due to corruption and an inefficient judicial system that is vulnerable to political interference. The regulatory efficiency needed to develop a more dynamic entrepreneurial private sector has not been established.
Since the early 2000s, Vietnam has applied sequenced trade liberalisation, a two-track approach opening some sectors of the economy to international markets while protecting others. In July 2006, Vietnam d its intellectual property legislation to comply with TRIPS, and it became a member of the WTO on 11 January 2007. Vietnam is now one of Asia's most open economies : two-way trade was valued at around 160% of GDP in 2006, more than twice the contemporary ratio for China and over four times the ratio for India. Vietnam's chief trading partners include China, Japan, Australia, the ASEAN countries, the United States and Western Europe. In 2011, Vietnam's total international trade, including both exports and imports, was valued at approximately $200 billion.
As a result of several land reform measures, Vietnam has become a major exporter of agricultural products. It is now the world's largest producer of cashew nuts, with a one-third global share; the largest producer of black pepper, accounting for one-third of the world's market; and the second-largest rice exporter in the world, after Thailand. Vietnam has the highest proportion of land use for permanent crops -6.93%- of any nation in the Greater Mekong Subregion. Other primary exports include coffee, tea, rubber, and fishery products. However, agriculture's share of Vietnam's GDP has fallen in recent decades, declining from 42% in 1989 to 20% in 2006, as production in other sectors of the economy has risen.
The study is proposed a SWOT analysis method for the identification of environmental information and key environmental aspects. SWOT analysis is frequent used to simple methodology to choose marketing strategy in the enterprise. Also, SWOT analysis method is quick, accurate, and cheap thing. It discovers strength and weakness in the internal of the enterprise, and discovers opportunity and treatness in the outside of the enterprise. Next, opportunity is increased, Weakness is grows, opportunity apply for, and threat is avoid.
SWOT analysis of Shin-La In Korea results were as follows :
First, S-O strategy is to promote market diversification and preemption strategy through favorable market awareness and product innovation capabilities. Second, S-T strategy is to overcome the rising labor costs and logistics utilizing logistics synergies. Third, O-W strategy is to expand the domestic market and export market needs through production efficiency and cost reduction. Fourth, T-W strategy is to carve out hird-country export market through the company's marketing capabilities.
Through these management tasks and countermeasures of Korean companies in Vietnam, the management strategies for the future advance into Vietnam were suggested for companies and government as follows:
As the strategy for companies, the thorough provision and experience accumulation, the construction of effective communication channels and upbringing of middle managers, the construction of quality system in the company level, the enhancement of local procurement of raw materials, the promotion of localization strategy, and the ution of social responsibility to Vietnamese should be carried out to elevate the success probability.
This study is expected to be used as a basic data for small and medium companies planning the advance into Vietnam inclearly determining the advance purpose into Vietnaman the future direction of company.