Bien Hoa sugar's Ceo: Success = Old Foundation + New Orientation
In common context that Viet Nam sugarcane industry is still in difficulty, but Bien Hoa Sugar Joint Stock Company has impressive business result in 2014- 2015 crop year, excessive of more than 25% compared to profit plan, contributed to determine the position of one of Viet Nam leading sugar enterprises
Ms. Tran Que Trang – General Director of Bien Hoa Sugar Joint Stock Company
With firm and sound steps in recent 5-year development strategy, it shows that Bien Hoa Sugar has determined to reorganize its operation to likely to obtain strong competitiveness upon the integration.
To have more particular view, Enterprise Forum News has an interview with Ms. Tran Que Trang – General Director of Bien Hoa Sugar Joint Stock Company around this story.
After capitalization stage, from 2011 to now, Bien Hoa Sugar has continuously reorganized its operation, restructured the whole enterprise in each stage to complete management system step by step in order to develop available advantages of one long-term brand, simultaneously, to create new competitiveness. Impressive business result in 2014- 2015 is the achievement os right strategic orientation and successful performance of such strategy in the reality.
Bien Hoa Sugar has promoted its activities such as production extension, quality improvement, application to advanced quality control systems to enhance its competitive advantage in the future. In details, financial reports in previous years have recorded big investments on agriculture, production extension of two factories, fine sugar equipment, line improvement…Big projects such as Center Pivot (C.P) irrigation system at shops…upon its operation have brought desired effects, significantly improved product price. With extremely modern C.P irrigation system, sugarcane productivity and quality in the farm are increased from 70 tons/ha to more than 85 tons/ha. Besides, a series of cooperative projects on mechanized equipment and machines, production process improving study…are also tested at this farm.
Similarly, boiler extension project for fine sugar factory helps significantly improve fuel rate to processing step: Bien Hoa Sugar’s fuel loss rate is roughly equal to processing cost of Thailand’s sugarcane enterprises, thus, the competition upon the integration is absolutely possible.
– As major operator of all activities in Bien Hoa Sugar, which the most confident thing do you feel as CEO in the last year?I think, the thing I feel confident most as CEO of Bien Hoa Sugar is the staff. In details, Bien Hoa Sugar has many changes on personnel, especially senior personnel. The last 5-year route is also historic transfer period of Bien Hoa Sugar with old foundation but new orientation. Current labor-force is a combination between old and new factors.
Bringing a 50-year enterprise into a new orientation requires a harmonious cooperation of both old and new factors. We absolutely retain technical foundations that is a former strength of Bien Hoa Sugar, sales, executive labor-force are new faces and methods. In the first stage, it is not absolutely favorable surely but we have promptly found out a common voice. Up to now. Bien Hoa Sugar labor-force’s stature has changed completely, we are confident when stepping together in subsequent stages. Business result and value added that Bien Hoa Sugar has created in the last time are evidences of effective attachment in Duong Bien labor-force.
– In the trend of international economic integration, especially Viet Nam’s participation in the implementation of commitments in TPP, AEC agreements, how does Bien Hoa Sugar prepare to lead this “game”?We have actively acknowledged from previous 5 years that in Viet Nam sugar industry’s opinion, in the future, it is not the thing that Viet Nam sugar enterprises will compete together but to foreign sugar ones in fair condition. 2011- 2015 stage strategy of Bien Hoa Sugar is built based on this opinion and 2016- 2020 stage strategy will be highlighted more.
The key to the coming competition problem is the price but it is not simple to improve price problem. It requires a synchronous improvement of the whole sugar industry with many participants but not enterprises only. However, enterprises are in decisive role. Only enterprises can deploy synchronously a series of solutions from agricultural step to production step for price improvement.
For Bien Hoa Sugar, we have identified this problem, and put out the right orientation and partly deployed successfully in the last time. In the next stage, the orientation won’t change and we will put the center into the implementation and good control to this process in remaining part.
– For the M&A deal with Ninh Hoa Sugar, how do you think of this M&A?
I think, the M&A is an inevitable trend to enhance competitiveness of Viet Nam sugarcane enterprises, especially it is the fastest way to seal with the problem on production scale. We see the M&A between Ninh Hoa Sugar Joint Stock Company and Bien Hoa Sugar will create sharing value for both units and bring this thing into the 2011- 2015 strategy. Upon the implementation in fact, although there are many opposite ideas, making the M&A process face some difficulties, but finally the common trend still has higher persuasiveness and the M&A has fulfilled in the intended time. This is a turning point marking a successful closing of the 2011- 2015 strategy, simultaneously, the premise of the 2016- 2020 strategy. With great advantage received after the integration, in the next strategic period, we must change that advantage into Bien Hoa Sugar’s competitiveness to ready to the participation in and competition with economic communities since 2018.
– According to your’ assessment, in the next time, which orientation does Viet Nam Sugar industry intend?
In Viet Nam, annual consumption demand is about 1.5-1.6 million tons, while inventory amount is in quite low level compared to year-over-year, but material price is in increased trend due to serious sugar shortage in all areas of the country.
It is forecast that Viet Nam sugar industry in 2015- 2016 crop will be lacking, that is seemed as an advantage of factories. Nevertheless, in fact, it is not really an opportunity when the season has overcome more than 1/3 time whereas sugarcane cost still increases with every passing day and due to weather factor, sugarcane quality this year declines. Production problem is very complex meanwhile the output is not absolutely clear, all of them are factors enterprises must consider carefully as making a business decision.
In the long term, 2018 is a landmark Viet Nam will officially participate in the competition with international community, according to my opinion, only enterprises which have comprehensive preparation on management, deep investment with clear strategic orientation can have enough force to compete in the new market.
Thanh Trung
