MGT103 Introduction to business
Class: MKT 1618

GROUP INFORMATION
Group number

2

Class:

MKT 1618

GROUP MEMBERS
NO

NAME

ID

1

NGUYỄN THỊ OANH

HS 160319

2

LÊ VIỆT HÀ

HS 160606

3

NGUYỄN LƯU CHIẾN THẮNG

HS 160539

4

LÊ ANH TÚ

HS 160542

5

LẠI QUANG HUY

HS 160500

6

HOÀNG THỊ MAI ANH

HS 160292

1


TABLE OF CONTENT
1. Introduction
1.1. Purpose of group assignment

1.2.

Brief introduction of the company

2. Literature review and critical analysis
2.2.

Literature review
2.2.1. Organization structure theory
2.2.2. Planning and decision-making process theory
2.2.3. Business strategies theory
2.2.4. Human resource management theory

2.3.

Critical analysis
2.3.1 Organization structure,
2.3.2. Planning and decision-making process
2.3.3. Business strategies
2.3.4. Human resource management
2.3.5. Challenges

3. Recommendation
4. Conclusion
4.2.

Summary of contribution

4.2 . Limitation


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1. Introduction
1.1 Pupose of group assignment
2. Vietnam Airlines is a regional and international airline that is facing a number of
challenges. For example, in order to achieve its goal of becoming Southeast Asia's flagship
airline, Vietnam Airlines will need to spend significantly in infrastructure. So, how do you
plan to make your dreams of being one of Vietnam's most well-known and profitable
aviation enterprises a reality? Through the following sections of this article, we will
discover how Vietnam Airlines generates and performs those things: first, organizational
structure, then planning decision-making, business strategy, human resource management,
and ultimately issues and solutions.

2.1 Brief introduction of the company

-" Tổng Công ty Hàng không Việt Nam – CTCP " is the company's Vietnamese name.
Vietnam Airlines JSC is the company's English name. Vietnam Airlines is the abbreviation
for Vietnam Airlines:

- The company's charter capital is 11,198.648,400,000 VND. With the tax code
0100107518 and the HVN stock code. And www.vietnamairlines.com is the company's
website. Phone: (84.4) 38272289; Fax: (84.4) 38722375
- Hanoi Department of Planning and Investment granted business registration number
0100107518 for the first time on June 30, 2010 and amended it for the third time on April
1, 2015. Head office is located at 200 Nguyen Son in the Long Bien District of Hanoi,
Vietnam.
- On May 27, 1995, Vietnam's Prime Minister, Vo Van Kiet, signed a resolution to form
Vietnam Airlines Corporation (Vietnam Airlines Corporation) based on the merger of 20
aviation-related businesses, with the airline serving as the country's cornerstone. Two

Fokker 70s were bought for $50 million in mid-1995 to replace the Tupolev Tu-134 fleet
on domestic routes. In December 1995, Vietnam Airlines and GECAS agreed to lease three
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Boeing 767-300ERs from Continental Airlines (a US carrier that merged with United
Airlines on March 3, 2012) to replace three Boeing 767-300ERs and one Boeing
767-200ER leased from AWAS and Royal Brunei Airlines, respectively.
- Before 2002, the sign of Vietnam Airlines was a stork soaring across the full moon.
Vietnam Airlines hosted a ceremony on October 20, 2002, to reveal the new emblem
"Golden Lotus." This is a watershed moment in Vietnam Airlines' transformation into a
world-class airline by updating its fleet, increasing its route network, and boosting service
quality. Around the globe.

-Following the nationalization of Gia Lam airport on January 15, 1956, Prime Minister of
the Democratic Republic of Vietnam Pham Van Dong signed Decree No. 666/TTg creating
the Civil Aviation Administration of Vietnam. This is the official founding date of Vietnam
Airlines as we know it today. The airline had only five planes in its fleet at the time
(Ilyushin Il-14, Antonov An-2, Aero Ae-45...). VN-198, VN-199 (Lisunov Li type) and
VN-200, VN-201, VN-202 (Lisunov Li type) civil aircraft fleet (Aero-45 type). The Hanoi
- Vinh - Dong Hoi route was the first domestic flight, and it was launched on September 2,
1956, on National Day, for 30 northern dong.
- Many international routes to Asian nations such as Laos, Cambodia, China, Thailand,
Philippines, Malaysia, and Singapore were actively utilized between 1976 and 1980.
Vietnam civil aviation joined the International Civil Aviation Organization (ICAO) at the
conclusion of this decade (ICAO).
- Vietnam Airlines was founded in April 1993 as a large-scale state-owned air transport
company group. On May 27, 1996, Vietnam Airlines Corporation was founded on the basis
of integrating 20 aviation and service businesses, with Vietnam Airlines as its center.
- The Vietnam Airlines Corporation - JSC Board of Directors. Mr. Dang Ngoc Hoa is the

Chairman of the Board of Directors, while Mr. Le Hong Ha, Mr. Le Truong Giang, Mr. Ta
Manh Hung, and Mr. Tomoji Ishii are members of the Board of Directors.

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-The Board of Directors of Vietnam Airlines Corporation- JSC. The Board of Directors
consists of Mr. Dang Ngoc Hoa as the Chairman of the Board of Directors and the
management members are Mr. Le Hong Ha, Mr. Le Truong Giang, Mr. Ta Manh Hung. Mr.
Tomoji Ishii. Next, the Supervisory Board consists of Ms. Nguyen Thi Thien Kim and the
members of that committee are Mr. Lai Huu Phuoc and Mr. Mai Huu Tho. Finally, the
board of directors includes Mr. Le Hong Ha as the general director, and the deputy general
directors include Mr. Trinh Ngoc Thanh, Mr. Trinh Hong Quang, Mr. Nguyen Hong Linh,
Mr. Nguyen Chien Thang, Mr. To Ngoc Giang and Mr. Dinh van Tuan.
- There are three types of member companies: group 1 subsidiaries in which Vietnam
Airlines owns 100% of the stock, group 2 subsidiaries in which Vietnam Airlines owns
more than 50% of the stock, and group 3 subsidiaries in which Vietnam Airlines owns less
than 50% of the stock.
+Group 1 subsidiaries 100% owned by Vietnam Airlines include HK Catering Vietnam
Co., Ltd., VAECO Aircraft Engineering Co., Ltd., SKYPEC Vietnam Aviation Fuel One
Member Co., Ltd. Vietnam Airport Ground Service Company Limited VIAGS, Aviation
Flight Service Company - VASCO.
+ Group 2 subsidiaries with more than 50% capital held by Vietnam Airlines include TCS
Tan Son Nhat Cargo Services Co., Ltd., ABACUS Vietnam Global Distribution Co., Ltd.,
VINAKO Freight Forwarding Co., Ltd. Noi Bai Aviation Meal Joint Stock Company. , Noi
Bai Cargo Services Joint Stock Company, Tan Son Nhat Freight Forwarding Services Co.,
Ltd., Aviation Labor Import-Export Joint Stock Company, Noi Bai Nasco Aviation
Services Joint Stock Company, Company Aviation Informatics Telecommunication Joint
Stock Company
+Group 3 Companies in which Vietnam Airlines holds a controlling capital contribution of

less than 50% include: Export Joint Stock Company, Cambodia Angkor Air, Saigon Post
and Telecommunication Joint Stock Company SPT, First One Member Co., Ltd. Phuong
Nam Tourism and Shipping Investment.
- Business lines of Vietnam airline
+ Air passenger and air freight transportation. Passengers are transported by air. Luggage,
products, parcels, letters, etc. are all transported.
+ Management consultancy services are provided. Direct manufacturing and business, as
well as investment and investment capital management. Investing abroad, buying and
selling enterprises, depleting cash to acquire shares or transfer contributed capital, and
selling shares are all options.
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+General aviation operations are direct support service activities for air transportation
(flying topographic photography, geological survey, flight calibration of aviation
navigation stations, repair, and maintenance of high voltage power lines, etc.) oil and gas,
afforestation, environmental inspection, search and rescue, medical emergencies, and flying
in support of political, economic, social, security, and defense missions)
+ Other specialized aviation services: Providing commercial services, tourism, hotels,
tax-free sales at airport terminals and provinces and cities; other aeronautical services,
Provide ground-based commercial technical services; services at passenger terminals, cargo
terminals and parking services at airports and aerodromes
+ Repair and maintenance of means of transport (except for cars, motorcycles, motorbikes,
and other motor vehicles): Maintenance of aircraft, engines, spare parts, aviation
equipment and other technical equipment
+Producing measuring, testing, orienting and control equipment: Producing components,
spare parts, aircraft supplies, technical equipment, and other contents in the field of
aviation industry, providing technical services and spare parts for airlines in country and
abroad
+Manufacture of aircraft, spaceships, and related machinery: Import and export of aircraft,

engines, spare parts, aviation equipment (rent, lease, hire purchase and purchase, sale) and
other goods according to regulations Regulations of the State, Production, export and
import of equipment serving the air transport chain.
-

Achievements and Awards

+2016: "Asia's Leading Airline for Cultural Identity" and "Asia's Leading Economy
Airline" by World Travel Awards. Top 3 most progressive airlines in the world
(SKYTRAX). The airline with the best business class seat design on Boeing 787-9 and
Airbus A350-900” (China Global Traveler Magazine)
+ Top 4 airlines in Southeast Asia with passenger traffic reaching over 20 million (CAPA).
In 2017: "Airline of the year in Asia - Pacific region" by CAPA- Center for Aviation.
“World's Leading Airline for Cultural Identity” and “World's Leading Airline for Premium
Economy Class” by World Travel Awards 2017
+In 2018: One of the top favorite major airlines in Asia in 2018 (Traveler's Choice Major
Airlines – Asia 2018) voted by TripAdvisor. Skytrax recognized Vietnam Airlines as a
4-star airline for the third year in a row. And become a global 4-star airline by APEX (The
Airline Passenger Experience Association) organization.
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- In the direction of Vietnam Airlines' Future: Vietnam Airlines has been leading the way
for more than 20 years, with a double-digit growth rate, as a vibrant, contemporary
international airline imbued with Vietnamese traditional cultural character. The aviation
sector in Vietnam is one of the world's fastest growing domestic markets. Vietnam Airlines
aims to become Asia's top 5-star international airline as a contemporary airline with a
brand recognized for its cultural identity.

3. Literature review and critical analysis

3.1 Literature review
2.1.1. Organization structural theory
a. What Is an Organizational Structure?

● An organizational structure is a system that outlines how certain activities are directed in
order to achieve the goals of an organization. These activities can include rules, roles, and
responsibilities.
● The organizational structure also determines how information flows between levels within
the company. For example, in a centralized structure, decisions flow from the top down,
while in a decentralized structure, decision-making power is distributed among various
levels of the organization.
● Having an organizational structure in place allows companies to remain efficient and
focused.
b. Types of organizational structures
There are four types of organizational structures. Understanding how they work and what
their benefits and drawbacks are can help you make a more informed decision as to which
to implement in your workplace. The four types are:
+ Functional structure

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- In a functional structure, organizations are divided into specialized groups with specific
roles and duties. A functional structure is also known as a bureaucratic organizational
structure and is commonly found in small to medium-sized businesses. Most people in the
workforce have experience working in this type of organizational structure. For example,
many companies divide their organization into various departments such as finance,
marketing, and human resources. Each of these departments then has a manager who
oversees it. This manager is then supervised by an administrator or executive who oversees
multiple departments.

- Here are some advantages of this structure: Employees are grouped by skill. Greater sense
of teamwork
- Here are some disadvantages of this structure: Lack of communication with other
departments. Unhealthy competition. Management issues
+ Divisional structure

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● In a divisional structure, various teams work alongside each other toward a single, common
goal. Each of these divisions has its own executive who manages how that branch operates,
controls its budgets, and allocates its resources. Large companies employ this type of
organizational structure. One example of the divisional structure is a car company that
separates its company by SUV, electric, or sedan vehicle branches. While each branch has
its own function, they all work toward the same goal of making a sale. This is also known
as the multi-divisional structure.
● Here are some advantages of this structure: Focus on a single good or service. More
centralized leadership.
● Here are some disadvantages of this structure: Poor integration with other divisions.
Competition between divisions. Lack of communication between divisions. Potential tax
implications.
+ Flatarchy

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● In a flatarchy, there are little to no levels of management. A company using this structure
could have only one manager in between its executive and all other employees. It is called
a flatarchy because it is a hybrid of a hierarchy and a flat organization. This type of
organizational structure is used more by smaller companies since they have fewer

employees, though it can be used in companies of all sizes. While some companies grow
out of this organizational structure, others continue to use it.
● Here are some advantages of this structure: Cost-efficient, Fosters good communication,
Higher employee morale, Faster decision making
● Here are some disadvantages of this structure: Potential employee conflict, Leadership
confusion.
+ Matrix structure

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● In the matrix style of organizational structure, employees are divided into teams that report
to two managers—a project or product manager along with a functional manager. In
essence, a matrix structure is a combination of various organizational structures. Because
these teams have two managers, a matrix structure promotes duality and the sharing of
resources. Employees working for companies using the matrix structure have the potential
to widen their skill set since they might be assigned to various projects requiring different
levels of expertise or skills.
● Here are some advantages of this structure: Fosters open dialogue, Flexible workplace
environment
● Here are some disadvantages of this structure: Leadership confusion, Conflicting
leadership loyalties, Potentially more costly, Roles may not be clearly defined, Potentially
heavy employee workload.
c. Benefits of Organizational Structures
● Putting an organizational structure in place can be very beneficial to a company. The
structure not only defines a company's hierarchy but also allows the firm to lay out the pay
structure for its employees. By putting the organizational structure in place, the firm can
decide salary grades and ranges for each position.

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● The structure also makes operations more efficient and much more effective. By separating
employees and functions into different departments, the company can perform different
operations at once seamlessly.

● In addition, a very clear organizational structure informs employees how best to get their
jobs done. For example, in a hierarchical organization, employees will have to work harder
at buying favor or courting those with decision-making power. In a decentralized
organization, employees must take on more initiative and bring creative problem solving to
the table. This can also help set expectations for how employees can track their own
growth within a company and emphasize a certain set of skills—as well as for potential
employees to gauge if such a company would be a good fit with their own interests and
work styles.
2.2.2. Planning and decision-making process theory
How to Do a SWOT Analysis
●
● Gather a team of civilization from a range of functions and degrees in your organization
and use Conferring techniques to build a list of ideas about where your organization
currently stands. Every time you identify a Strength, Weakness, Opportunity, or Threat,
write it down in the applicable part of the SWOT analysis gridlock.
●
● Let's look at each area in more characteristic and assume what suits where, and what issues
you could ask as part of your calculation.
●
● Strengths
●
● Strengths are things that your company does particularly satisfactorily, or in a way that
distinguishes you from your candidates. Understand about the advantages your institution
has over other companies. These might be the enthusiasm of your staff, access to specific

elements, or a strong set of manufacturing methods.
●
● Your strengths are an essential part of your community, so reckon about what makes it
"tick." What do you do better than anyone else? What respects drive your business? What
unique or lowest-cost resources can you draw upon that others can't? Identify and analyze
your organization's Unique Selling Proposition (USP), and add this to the Strengths
section.
●
● Then turn your perspective around and ask yourself what your competitors might see as
your strengths. What factors mean that you get the sale ahead of them?
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●
● Remember, any aspect of your organization is only a strength if it brings you a clear
advantage. For example, if all of your competitors provide high-quality products, then a
high-quality production process is not a strength in your market: it's a necessity.
●
● Weaknesses
●
● Weaknesses, like strengths, are inherent features of your organization, so focus on your
people, resources, systems, and procedures. Think about what you could improve, and the
sorts of practices you should avoid.
●
● Once again, imagine (or find out) how other people in your market see you. Do they notice
weaknesses that you tend to be blind to? Take time to examine how and why your
competitors are doing better than you. What are you lacking?
●
● Be honest! A SWOT analysis will only be valuable if you gather all the information you
need. So, it's best to be realistic now, and face any unpleasant truths as soon as possible.

●
● Opportunities
●
● Opportunities are openings or chances for something positive to happen, but you'll need to
claim them for yourself!
●
● They usually arise from situations outside your organization and require an eye to what
might happen in the future. They might arise as developments in the market you serve, or
in the technology you use. Being able to spot and exploit opportunities can make a huge
difference to your organization's ability to compete and take the lead in your market.
●
● Think about good opportunities you can exploit immediately. These don't need to be game
changers: even small advantages can increase your organization's competitiveness. What
interesting market trends are you aware of, large or small, which could have an impact?
●
● You should also watch out for changes in government policy related to your field. And
changes in social patterns, population profiles, and lifestyles can all throw up interesting
opportunities.
●
● Threats
●
● Threats include anything that can negatively affect your business from the outside, such as
supply-chain problems, shifts in market requirements, or a shortage of recruits. It's vital to
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anticipate threats and to act against them before you become a victim of them and your
growth stalls.
●
● Think about the obstacles you face in getting your product to market and selling. You may

notice that quality standards or specifications for your products are changing, and that
you'll need to change those products if you're to stay in the lead. Evolving technology is an
ever-present threat, as well as an opportunity!
●
● Always consider what your competitors are doing, and whether you should be changing
your organization's emphasis to meet the challenge. But remember that what they're doing
might not be the right thing for you to do. So, avoid copying them without knowing how it
will improve your position.
●
● Be sure to explore whether your organization is especially exposed to external challenges.
Do you have bad debt or cash-flow problems, for example, that could make you vulnerable
to even small changes in your market? This is the kind of threat that can seriously damage
your business, so be alert.

2.2.3. Business strategies theory
Any company's success is defined by the effectiveness of the plan it employs. A company's
strategy shows how it expects to compete in a market and grow profitably. Businesses sell
goods and services in competitive markets all over the world, and in order to stay afloat,
they must improve the value of their assets for their owners and shareholders. This
necessitates a strategy that assists managers in making informed decisions and effectively
allocating resources to meet important objectives. A business strategy is another name for
this plan. So, the question here is what is a business strategy? A business strategy lays out a
plan of action for achieving an organization's vision and defined goals, as well as guiding
decision-making processes to improve the company's financial stability in a competitive
market. And how is strategy different from tactics? Before we get into the specifics of
developing a plan, it's critical to grasp the difference between a strategy and a tactic. While
these names are frequently used interchangeably, they refer to two distinct concepts:
A strategy is a document that outlines an organization's long-term objectives and how it
intends to achieve them. In other words, it depicts the path that will lead to the achievement
of the stated goal. A tactic, on the other hand, refers to the exact activities used to achieve

the defined goals in accordance with the strategy. And the last question here is why is
having a business strategy important? Any business's ability to succeed depends on the
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existence of a strategy. It essentially represents the firm's strengths and weaknesses, as well
as how the organization intends to respond to threats and opportunities in the market in
which it operates. A strategy considers the available resources and how to best deploy them
to meet the goals. That's why a strategy is sometimes referred to as a company's lighthouse:
it unifies the work of all functional areas and provides employees with a NorthStar to guide
their everyday decision-making. Let's imagine a company doesn't have a strategy for how it
will compete in a market: the lack of such a blueprint would result in disorganized actions
in each area, limiting the organization's overall effectiveness. This incoherence inevitably
leads to a loss of competitive advantage, which will be exploited in the market.
2.2.4. Human resource management theory
a. Recruiting:
The process of attracting individuals to apply for jobs that are open. Vietnam airlines use
external recruiting is get people from outside the organization to apply for jobs. They use
Advertising, union halls, campus interviews, employment agencies, etc
After that they use Test is Ability, skill, aptitude, or knowledge tests are usually the best
predictors of job success. Tests must be validated, administered, and scored consistently.
The testing process must be the same for all candidates. They have interviews.
–Interviewer biases can be overcome, and interview consistency and validity can be
improved by training interviewers and using structured interviews.
b. Education policy
They will have training for the new candidates. In this step, they teach operational or
technical employees how to do the job for which they were hired. After that development
teaching managers and professionals, the skills needed for both present and future jobs.
C. Salary Bonus:
They will care more, and motivate employees as use a Salary Bonus, Compensation, etc.

First, know more about salary bonus is determining compensation. It has compensation.
This means the financial remuneration is given by the organization to its employees in
exchange for their work. We have Forms of compensation Salary is paid for the total
contribution of an employee and is not based on total hours worked. Incentives are special
compensation opportunities that are usually tied to performance. Besides, Purposes of
compensation Provide a reasonable standard of living, Provide a tangible measure of an
individual’s value to the organization

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2.3 Critical analysis
2.3.1 Organization structure:
Vietnam Airlines Organization Structure

a. General Meeting of Shareholders
The General Meeting of Shareholders is Vietnam Airlines' highest decision-making body,
comprising all shareholders with voting rights and working through Annual General
Meetings of Shareholders, Extraordinary General Meetings of Shareholders, and written
consultation.
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b. Control Board
The Supervisory Board is the body elected by the General Meeting of Shareholders to
control, evaluate independently, objectively, and honestly all business activities,
administration, and management of Vietnam Airlines, as well as the company's financial
status, and to take responsibility in front of the General Meeting of Shareholders for
completing assigned tasks.
c. Board of Directors

The Board of Directors is the governing body of Vietnam Airlines, having full authority on
behalf of Vietnam Airlines to decide and perform the rights and obligations of Vietnam
Airlines that are not within the authority of the General Meeting of Shareholders.
General manager
The General Director is the legal representative of Vietnam Airlines and is the person who
runs the day-to-day operations of Vietnam Airlines.
Function rooms
Supporting committees of the Board of Directors are established by the Board of Directors,
including Strategy and Investment Committee, Human Resources and Salary Committee,
and Internal Audit Committee. Committees work on a part-time basis. The Corporation's
specialized committees, according to their functions, perform the task of assisting the
Committees established by the Board of Directors.
General assisting apparatus for the Board of Directors and General Director: are the Deputy
General Directors, Chief Accountant, offices, professional departments, and equivalent
agencies of the Corporation with the function of participating in advising and assisting the
Board of Directors and the General Director in the management and administration of
work.
The organizational structure of Vietnam Airlines' operational apparatus includes: The head
office is located in Hanoi with 16 specialized departments; 33 foreign branches and
representative offices; 14 affiliated units in the country. In addition, Vietnam Airlines
contributes capital to invest in subsidiaries and associated companies.
2.3.2 Planning and decision-making process
SWOT (strengths, weaknesses, opportunities, and threats) analysis is a framework used to
evaluate a company's competitive situation and to improve strategic planning. SWOT
analysis analyzes internal and external factors, to predict future potential.
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A SWOT analysis is designed to simulate a realistic, fact-based, data-driven look at the
strengths and weaknesses of an organization union needs to keep the analysis accurate by

avoiding preconceived beliefs and instead focusing on real-life contexts.
For example, Viet Nam Airlines have
Strength
Large financial resources: According to Vietnam Airlines' consolidated financial statements
for the three years of 2017, 2018 and 2019, the gross profit in each year is over 10 trillion
VND
Position of Vietnam Airlines in regional markets: Vietnam Airlines is the airline with the
largest domestic flight network, in addition, it has a network of routes to exploit and
cooperate with airlines, exploiting international passengers to go with domestic. The
domestic market is mainly competed by airlines such as VNA, JPA and Vietjet Air. In
which, JPA is a subsidiary of VNA, operating under the model of a low-cost airline,
operating on regional domestic and international routes with low-cost competition and
close coordination with VNA on products. products and support the sharing of mining
resources.
With its geographical location between Northeast Asia, Southeast Asia, Europe, South
Pacific and China, Vietnam is considered as the gateway of regions. By the end of 2014,
Vietnam Airlines has an international route network of 57 routes to 29 destinations in 17
countries and territories, a domestic route network of 39 routes to 21 destinations, of which
the international route network has been expanded. rapidly expanding and developing in
Europe (UK, Russia), Northeast Asia (Japan, Korea, China, Taiwan) and Cambodia - Laos
- Myanmar (CLMV) sub-region. . According to VNA's statistics, in 2014, Vietnam
Airlines' international passenger transport market share was maintained at 40.5%.
Weakness
Fares are higher than competitors in the same industry and High maintenance costs with
large number of aircraft
The national airline Vietnam Airlines forecasts a loss of about 4,800 billion dong in the
first quarter of 2021, in the first 6 months of the year, the loss may reach 10,000 billion
dong. Currently, Vietnam Airlines' overdue debt is up to VND 6,240 billion
Vietnam Airlines Corporation - JSC (Vietnam Airlines) has just announced its financial
report for the second quarter of 2021.

In the context of complicated developments of the Covid-19 epidemic, international routes
cannot be reopened and domestic routes are also limited, Vietnam Airlines' revenue
continues to be low at only 6,537 billion VND.
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Compared to the same period last year, Vietnam Airlines' revenue increased by about 9%,
but if the air transport segment alone, the national airline's revenue decreased by more than
10%.
Meanwhile, the cost price of Vietnam Airlines exceeded 10,000 billion dong, up 13% over
the same period. As a result, Vietnam Airlines has a gross loss of nearly 3,500 billion dong,
up 22% compared to the previous year's loss.
Opportunities
VietNam Airline will be received some opportunities if they use of aircraft for cargo
purposes and Improve image by supporting Government and health sector in transportation
so that Improve the image by supporting the return of overseas Vietnamese.
Threat
Vietnam Airline will solve some problem such as financial pressure, Ensure the safety of
each flight during Covid-19. When the COVID-19 pandemic took place, the world
economy suffered great damage, and the first industry that suffered the most was the air
transport industry. To prevent the rapid spread of the disease, countries have closed their
borders, along with the suspension of international flights.

Solution
In the foundation of the administrative model of decision-making lies the belief that
decision makers often settle for a less than ideal solution because of time and motivation
shortages. Instead of seeking the best solution that maximizes the value of the decision, the
decision maker accepts the first available 'good enough' alternative producing a value
above the minimally acceptable. The concept of settling for a less than perfect solution is
called satisficing.

Facing complicated and prolonged developments of the COVID-19 epidemic, Vietnam
Airlines has implemented 5 response solutions, including: Cost reduction and savings
(about VND 5,035 billion); Negotiating with partners on rescheduling and postponing
payments (as of August 31, 2020, the payment schedule has been delayed/delayed by VND
3,678 billion; Reducing labor and salary costs (using 66-68 in 2020) % of labor, total labor
cost reduced by VND 3,500 billion); Short-term loans to compensate for resource
shortages; Restructuring loans. So that Vietnam Airlines closely follows market
developments and adjusts policies accordingly Prepare adjustment options depending on
the translation
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In 2021, in the face of the complicated situation of the Covid-19 pandemic, Vietnam
Airlines develops a feasible plan with a consolidated revenue target of VND 37,364 billion,
equivalent to 88.4% compared to 2020. To overcome the pandemic During the pandemic
and seizing development opportunities, Vietnam Airlines aims to maintain operational
safety, prevent epidemics, maintain the key position of Vietnam Airlines Group in the
aviation industry, comprehensively restructure and carry out the transformation. powerful
number changer.
Vietnam Airlines continues to find all solutions to increase revenue and reduce and
optimize costs (especially fleet restructuring, aircraft rental costs); restructuring the
portfolio of capital investment outside the enterprise; consolidating the organization of
blocks in the direction of streamlining the apparatus, reducing the middle class,
streamlining the number of employees; ensure and improve service quality (firmly 4 stars
and progress to 5 stars).
2.3.3. Business strategies
Analyze the business strategy of Vietnam Airlines.
The mission of this part is we going to analyze the business strategy of Vietnam Airlines.
So we will focus on the development strategy of this company. First of all, about the vision
and mission of the company are company wants to keep its no.1 position as the leader of

Vietnam's aviation group. Vietnam Airlines aims to become a prominent Asian airline of
choice for customers and to serve as the country's main mode of transportation as a flag
carrier. They seek to provide a broad and high-quality air transportation service that meets
the needs of their consumers. They also strive to provide a civilized and professional
working atmosphere with a variety of career development options for employees. They also
aim to manage a successful business and provide long-term rewards to shareholders.
Second about the core values with the tagline "Safety is the first priority," and this is the
foundation of all activities. Maintain a customer-centric approach. Their growth is
inextricably linked to customer trust. Employees are the company's most significant asset.
All remuneration rules are designed to be fair and worthy to sustain the organization's
cohesion and solidarity. The company's motto is "creativity," and they are continually
innovating numerous business areas with a breakthrough mindset to achieve great success.
Airline group that is accountable. They recognize that corporate social responsibility is a
company practice that ensures all choices and actions are consistent with social
sustainability. About target in terms of revenue, becoming the third-largest airline group in
Southeast Asia. Vietnam Airlines is expected to be one of Asia's top ten favorite airlines. In
terms of scale, these are the top three airlines in Southeast Asia. Vietnam Airlines will
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improve its 4-star airline services and gradually achieve 5-star airline standards. To become
a comprehensive Digital Airline Group, implement a durable digital transformation.
Become one of Vietnam's most popular workplaces. And now we going to with
development strategy. Concerning the route network, the domestic network is the strategic
network. Vietnam Airlines will continue to expand its route network from Ha Noi to Da
Nang and Ho Chi Minh City, as well as promote new hubs like Hai Phong and collaborate
on product offers with JPA and VASCO. This is the principal operation network, generating
significant revenues throughout Southeast Asia, Northeast Asia, and the South Pacific.
Vietnam Airlines continues to enhance flying frequency in order to improve the products of
two flights per day each route using wide-body aircraft. The company also conducts

research to develop new routes from Central Asia to the Northeast Asia region, is
considering launching the Ha Noi-Melbourne route, and is looking for opportunities to
explore new destinations in Brisbane or Perth. The sub-regional network comprising
Cambodia, Laos, Myanmar, and Vietnam (CLMV): This is a network of significant
political importance. Vietnam Airlines must maintain effective competitiveness with the
Bangkok (Thailand) gateway, produce more goods connecting tourist areas in Central
Vietnam and Indochina, and collaborate with K6 to assist Vietnam Airlines products.
About Intercontinental long-distance flight network: This is a long-term strategic network
that has been thoroughly examined and constructed. While ensuring the overall operating
effectiveness of the network, Vietnam Airlines is picking a few more European destinations
and evaluating new routes to America's Los Angeles or San Francisco. Concerning Fleet
Strategy Wide-body aircraft: continue to run the current fleet for Europe, Australia, and
Northeast Asia, but consider investigating new routes to America to ensure business
efficiency. Narrow-body aircraft: service the domestic market as well as foreign routes with
low capacity/short-haul (less than 5 hours of flying time). Regional jets or turboprops:
sustain routes using ATR 72 aircraft, run niche markets (short routes, small capacity,
airports with inadequate infrastructure, etc.), research new types of aircraft to replace ATR
72. Concerning investment Strategy. Along with the fleet investment, Vietnam Airlines is
working to strengthen aircraft operation and maintenance capacity, as well as IT
infrastructure. The intention is to spend 50% of the investment capital on the fleet and 50%
on other issues. Concerning capital strategy. Using a combination of capital sources to
ensure the mobilization of sufficient financial resources for investment needs; based on the
premise of maintaining a safe debt-to-equity ratio and low financial expenses. Vietnam
Airlines use the following solutions to carry out this strategy: I Increasing owner equity by
share issue to increase charter capital; increasing share premium and operational profit; (ii)
Obtaining funds from capital markets through a commercial loan, bond issuance, and
export credit loan (if eligible); and (iii) Using the Sale and Leaseback structure.With a very
clear and strong approach, they would have numerous accomplishments in 2019 when the
first "super aircraft" Boeing Dreamliner 787-10 welcome. get Skytrax 4-star airline
standard certification for 4 consecutive years to become one of FORBES VIETNAM'S

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TOP 50 BEST LISTED COMPANIES when have become VIETNAM'S LARGEST
AIRLINE FLEET with the fleet surpassing 100 aircraft.

2.3.4. Human resource management
A. Labor force
Overview
According to the labor structure information table on March 31, 2015, from Vietnam
Airlines, the total number of employees is 10, 244 people. Among them, 55% are male and
44% female. In terms of educational attainment, 45% have university and post-graduate
degrees, 18% are college and intermediate, 32% are skilled workers and 5% are unskilled
workers. The total number of indefinite employees is 7,948, accounting for 78% of the total
number of employees and the rest are fixed term.
Regarding labor quality, Vietnam Airlines' workforce is basically young: 72.5% are under
40 years old, of which under 30 years old account for 32.6% (data 31/03/2015).
Events due to Covid-19
Due to the impact of Covid 19 in 2020: Mr. Duong Tri Thanh, General Director of Vietnam
Airlines said that due to the impact of the Covid-19 epidemic, over 10,000 employees had
to stop working (50%) and 100 employees had to stop working. % of employees at this unit
have to reduce wages.
As of June 1, 2018, the number of pilots (pilots) of Vietnam Airlines is 1,138 people,
including 853 Vietnamese pilots (including 51 pilot trainees who are training for
conversion). and 285 foreign pilots (25%).
Vietnam Airlines Corporation currently has more than 20,000 employees, including 1,200
pilots, 2,500 aircraft engineers, and 3,000 flight attendants. This also means that the
number of employees of Vietnam Airlines must stop working up to more than 10,000
people. (2020)
With the impact of the epidemic, the airline is forced to restructure and make big changes

from 2021.
B. Recruitment:
Vacancies:
● Pilot
- Flight Attendant
- Remaining Labor
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For the position of a flight attendant, the pre-training requirements are quite strict as
follows
. For applicants new:
- Being a Vietnamese citizen with Vietnamese nationality
- Female aged 20 to 26; height from 158 cm to 175 cm
- Male from 20 to 28 years old; height from 168 cm to 182 cm.
- Arms reach (when on tiptoe): at least 212 cm.
- Weight appropriate for height.
- Graduating from high school or higher, Priority is given to graduating from high school,
college, university.
- Health: Meet the health requirements of flight attendants.
- Clear background.
- Balanced appearance, good communication skills, confidence, suitable for service
professions.
- English: minimum: TOEIC 600 points or valid TOEFL it (68), TOEFL cbt (190), IELTS
(5.5) certificates.
- Priority is given to candidates who have a second foreign language degree (Chinese,
French, German, Russian, Japanese, Korean).
Pilots will be trained before working.
Criteria for pre-qualification of PCCB trainees:
- Be a citizen of the Socialist Republic of Vietnam

- High school graduate or higher
- TOEIC 700 or higher or score 6.0 or higher (certificate of valid)
- Age from 18 to 32 years old
- Height: from 1m65 (male), from 1m60 (female)
- Weight: from 54kg (male), from 48kg (female)
- Meet the health standards for civil pilots of the Civil Aviation Administration of Vietnam
C. Training policy
+ General: To mobilize social resources for training, since 2014, Vietnam Airlines has
implemented a policy of socializing pilot training (Vietnam Airlines has launched training
programs and orientations). quality basic pilot training centers, trainees pay their own
training costs, and Vietnam Airlines recruits when students completed the course). This is a
fundamental change in the training activities of Vietnam Airlines, contributing to saving
training costs.

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The regimes and policies for employees are always guaranteed by Vietnam Airlines at the
most reasonable level. In the period 2011-2015, Vietnam Airlines has implemented 5
rounds of salary reform, contributing to taking care of the material and spiritual life of
employees. The regimes on salary, insurance, protection, sightseeing, convalescence... are
fully implemented. Accordingly, Vietnam Airlines has gradually improved its salary policy
in the direction associated with productivity and work efficiency.
Recent campaigns:
Implement the 2020 Business Plan on professional training and skill improvement for
employees. From May 11 to May 13, 2020, at Noi Bai International Airport, leaders of the
On-board Service Center - VIAGS NBA directly taught classes to impart Safe Driving
Skills to 100% TTB operators.
Continuing to promote training to prepare service resources when output recovers, the
Domestic Team of the Passenger Service Center organized 03 classes to refresh travel

documents directly (Grade 1. 24-25/ 4, Grade 2. April 27-28, Grade 3. 1-2/5) with nearly
50 turns of people (Supervisor & staff of the domestic counter procedure team) under the
teaching of Tourism Traffic Teacher Tran Ngoc Tram Anh - Captain of the C-VIP Team of
the Domestic Team.
Includes the following contents:
● Consolidation of knowledge about GTDL.
● Refresh knowledge of looking up TIMATIC, Quick reference.
● Lessons learned from events related to tourism in the first quarter of 2020 and points to
note policy changes when serving the Covid19 period.
C.

Compensation:

At fine airline: The regimes and policies for employees are always guaranteed by Vietnam
Airlines at the most reasonable level. In the period 2011-2015, Vietnam Airlines
implemented 5 rounds of salary reform, contributing to taking care of the material and
spiritual life of employees. The regimes on salary, insurance, protection, sightseeing,
convalescence... are fully implemented. Accordingly, Vietnam Airlines has gradually
improved its salary policy in the direction associated with productivity and work efficiency.
The average salary of some production positions in 2014 is as follows:
- Pilot: 83.19 million VND/person/month.
- Flight attendants: 20.21 million VND/person/month employees:
- Remaining labor: 11.22 million VND/person/month
2.3.5. Challenges
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+ When the COVID-19 epidemic broke out, it wreaked havoc on the global economy, but
the air transport industry was the first to be impacted. In the backdrop of the global aviation
industry's crisis, the COVID-19 epidemic has had an influence on Vietnam's aviation sector

as well. The Ministry of Planning and Investment stated in its report on business
development in 2020 and the first five months of 2021 that the aviation industry had the
most serious decline, with demand for air transportation in 2020 decreasing by 34.5% to
65.9%, and revenue of aviation enterprises decreasing by 61 percent compared to 2019.
+ Financially, cash and accounts are in good shape. However, the epidemic has "pulled" the
aviation industry down 3-4 years and made the accumulation of 4-5 years ago of this unit
considered to be zero.
+ Almost all aircraft are being decommissioned, with just 1-2 percent of total aircraft being
used (using 8/106 aircraft).
+ The national carrier Vietnam Airlines expects a loss of around 4,800 billion dong in the
first quarter of 2021, and a loss of 10,000 billion dong in the first six months of the year.
With the present flight schedule and pandemic scenario, Vietnam Airlines' General Director
estimates that the airline's supply load would be reduced by around 60% in 2020, with
income falling by VND 50,000 billion, or 65 percent, compared to the plan. Currently,
Vietnam Airlines' past-due debts total VND 6,240 billion; the company is in dire straits, on
the verge of bankruptcy, and commercial banks have yet to see the government's support
package of VND 12,000 billion, so they are refusing to disburse funds or extend or grant
credit lines to Vietnam Airlines.

4. Recommendation
+ Aviation is a vital business, not only in terms of economic development, but also in terms
of national security, defense, and sovereignty. Prior to the COVID-19 epidemic, the global
aviation sector was experiencing rapid growth. However, when the COVID-19 epidemic
struck, the aviation sector was seriously harmed, and governments all over the world were
forced to scramble to find solutions to save their own aircraft industries. In addition, my
organization offers some suggestions for the Vietnamese aviation business and airline.
+ To overcome the pandemic and exploit development prospects, Vietnam Airlines must
strive to preserve operational safety, avoid epidemics, retain the Group's leadership position
in the aviation sector, and reorganize comprehensively and effectively.
+ Need to find all solutions to increase revenue and reduce and optimize costs (especially

fleet restructuring, aircraft rental costs); restructuring the portfolio of outside capital
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