Pangasius processing workshop – Photo: Vinh Hoan Corp.
The Government also proposed 12 groups of measures to cure “severe illness” for Viet Nam’s economy, and announced a bailout package worth VND29,000 billion to support businesses through tax policies such as debt freezing/reschedule/restructure, and tax deferment, etc.
However, “distant water cannot put out a fire at hand”, enterprises must save themselves before anyone else can help! The seafood community is going through the most difficult period ever after growing too fast and too shallow for a while. Although they make spectacular achievement in volume, the growth also accumulated a number of negative quality factors that led to bitter collapse when the external conditions change.
The difficulty was tough, but from the development perspective, it is also circumstances forcing enterprises to change, restructure and shape up themselves for in-depth development, assuming progressive management to improve productivity, quality, efficiency and competitiveness. Past experience shows that in many countries, all the successful companies must undergo restructuring every 7-9 years.
Since 2008, the seafood enterprises in Viet Nam, especially fish firms, have undertaken restructuring. Starting spontaneously, the restructuring process has scaled up and spread rapidly. The current crisis will impel enterprises to speed up restructuring with the following basic connotations.
First, enterprises need to expand the business coverage, from only processing to the entire value chain (seed, feed, breeding, processing, marketing and distribution). The control over the whole value chain will help them to stay flexible and responsive to the market changes, avoiding bottleneck caused by the conflicts between the stages in the chain.
Second, to restructure capital, businesses need to find and share profit with partners to amass capital while working 2012closely with banks to set aside bad debt, adjust the lending period based on the investment nature, and prevent the use of short-term capital for medium and long term investment. In collaboration with banks, enterprises can acquire weaker firms to expand their business. The cooperation between VASEP and the Viet Nam Development Bank (VDB) is the first step to help businesses restructure their capital.
Third, the management method and tools need to be changed to ensure the most efficient use of the company’s resources. Today, information technology provide a powerful hand for quick, comprehensive, effective and inexpensive management. The use of Microsoft Dynamics AX2012 and ERP or the electronic traceability software ETT will help companies improve the resource management and product quality throughout production process.
The hardest and most critical feature of company reengineering is to change the way the managers and staff think and act. Talents are the lifeblood of the company and it is crucial to retain them and enable them to develop sound and progressive work manners, habits, and attitudes to run the new organization structure.
The government needs to drastically reform its institutions and regulations so that the business community can successfully implement their restructuring. It is essential that the recent ‘pro-bank’ policies should be immediately repealed. The economic and social benefits must reconcile with environmental protection to ensure stable conditions for development.
And it is also essential that the state agencies and management staff reshuffle themselves to reduce the difficulties for enterprises. The new strength of the state agencies such as NAFIQAD, Department of Animal Health, Directorate of Fisheries, MARD, etc. accelerated by a staff who think and work in the businesses’ favour will be a valuable impetus for the restructuring process of the seafood industry.
NGUYEN HUU DUNG