Thesis (Master in Management) -- University of the Philippines Mindanao, April 2018

The RNF Industries Corporation is a family corporation, incorporated by Dr. Ramon N. Floresta and four (4) of his family members. It was duly registered with the Security and Exchange Commission on June 1, 2009. It has been engaging into manufacturing of wooden pallets and housing components, and ventured into tunnel-ventilated type poultry farm. The business operation started since 1994, when the organization was still on formation process into a sole proprietorship. It invested in industrial tree plantation as its own source of raw materials, considering that the outside source started to dwindle. This study identifies the main issues such as: the dwindling of log source or scarcity of raw materials, insufficiency of work skills training among employees, rising operational costs, and the absence of succession planning or unstructured corporate governance. The first three issues are made to be the basis of the proposed strategies, while the last one being a pivotal issue is to be implemented beforehand to ensure the existence of the organization. The issues are analyzed from the view point of strategic management which follows the methodology of Fred David. It applied data gathering through observations involving actual site visits, and extraction of information from documents, records and reports from the files of the organization and other sources. The strategies to be implemented the Backward Integration and Horizontal Integration, which compliments each other to address the main issues on the scarcity of raw materials and low production efficiency. The Backward Integration is a strategy to gain control over the competitors? suppliers, with the aim to purchase the raw materials from the said suppliers. It is derived from the opportunity in which several competitors are starting the cease their operation due to costly and stringent requirements imposed by the DENR in securing the renewal of permits to operate. For that matter, competitors? suppliers will have to constraint to look for other business operators, whom they can sell their logs. Thus, it affords the subject entity to negotiate and purchase their logs in its favor. The Horizontal Integration is a strategy to gain control over competitors in the industry. The subject entity for that matter will seek ownership or otherwise increased control over competitors. It will take the benefit of the competitors? internal weaknesses, either to buy the business facilities or to lease the same. In operation of the controlled businesses, it is expected that the organization's operational productivity will increase, and achieve hierarchy in the supplies of wooden pallets, housing components and other new products to the market. Both strategies respond to the internal and external environments, since the increase of supply of raw materials as result of Backward Integration and gained monopoly of the industry as a result of the Horizontal Integration and the gained monopoly of the industry as a result of the Horizontal Integration complement each other to increase production capacity. On the internal environment, the implementation of both strategies will redound to the organization in attaining the sustainability of the operations, hierarchy of the market shares, increase its revenue and expand its operations. On the external environment, it will translate into creation of more jobs opportunities, usage of higher technology, control of pollution- generating machines, market advantage over imported good, and competitiveness in the industry.