01 Oct 1998
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Dinh Thi Hoa: Up from the Ashes of War

by Dun Gifford, Jr. (MBA 1992)

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Dinh Thi Hoa (MBA '92) was a young girl when relatives and friends who feared for her safety spirited her out of Hanoi in the summer of 1972 to escape the fury of U.S. bombing attacks against North Vietnam. She still remembers returning after the bombing had stopped and seeing a city in ruins.

Today, 25 years later, Hoa is still living in Hanoi and doing her part to help her impoverished country establish a modern, productive economy. As managing director of Galaxy Company, a successful consulting firm, her advice on doing business in Vietnam is sought by blue-chip companies from around the world.

Hoa's route to the head of Galaxy has been a circuitous one. After high school, she lived in the former Soviet Union while attending the Moscow State Institute of International Relations. "In college, I read 54 books by Lenin, 25 books by Marx, and 27 books by Engels," says Hoa. "I learned all of the theory you can imagine but never anything practical."

Upon graduation, Hoa returned to Hanoi to work for the Ministry of Foreign Affairs' Press Center. There, she caught the eye of personnel from Harvard's Institute for International Development (HIID), who recommended her as a strong candidate for a World Bank Scholarship to attend business school at Harvard. "That is not an easy opportunity to refuse," Hoa notes.

With her background in communist theory and difficulty with English, Hoa found her first year at HBS a struggle. "I had no practical knowledge of business," she states. "When, for instance, a professor asked how a manager in a case should deal with the issue of a defective product, I had absolutely no clue. The only way I got through the program was to prioritize and really try to shine in the subjects I could do well - finance and marketing."

In 1993, after spending her first year out of HBS working as the Oil of Olay brand manager for Procter & Gamble (P & G) in Bangkok, Hoa returned to Hanoi to found Galaxy. With clients such as P&G, Motorola, and Boeing, she has established a foothold in one of the few growth industries in the country today: helping to locate common ground between communist Vietnam and capitalist foreign investors.

"Here in Vietnam you have a situation in which the market is small, and the bureaucracy is dense after many years of war and a planned economy," says Hoa. "Vietnam welcomes the billions of dollars outside firms are bringing in, but there is not a well-developed system to support foreign investors. The bureaucrats here are used to having minute control of every transaction; that doesn't work in the modern business world."

After steering Galaxy single-handedly for two years, Hoa recently took on a business partner, Tran Vu Hoai (MBA '94), an acquaintance whom she met through HIID and who worked most recently at the Vietnam offices of KPMG. "If I had to give two pieces of advice to foreign investors in Vietnam," says Hoai, "the first would be to be patient, and the second would be to look at Vietnam as part of a larger global strategy." Hoai and Hoa agree that short-term investments - over the next three or four years - will not realize substantial profits. But they are encouraged by the outlook five to seven years in the future.

Hoa predicts that Vietnam will evolve along the lines of the so-called Asian Tigers. "Consumer product markets in Vietnam are starting to reach capacity, but if you look at companies in the intermediate manufacturing sectors, such as those that serve the car and television industries, there will be many opportunities," she says. "Our development will probably be similar to South Korea's. They started with garments and shoes, went on to seats and tires for cars, and now they produce microchips and televisions."

Hoa and Hoai caution that foreign investors in Vietnam must, above all, do their homework. "One of the biggest mistakes that companies make when they are coming to Vietnam is to incorrectly assess market size," says Hoa, citing an example of one U.S.-based manufacturer that came to Vietnam in the early 1990s. "They saw the city streets crowded with motorbikes and made a heavy investment in what they thought was a potential market of 75 million customers," she explains. "They did not realize that less than 20 percent of the population in Vietnam live in the cities; the other 80 percent live in the countryside and are among the poorest people in the world."

For Hoa, one of the most rewarding aspects of her young career is that she has been able to contribute to the small but fast-growing Vietnamese economy. "In strategy class at HBS they always taught us to try to be the best at whatever you do in business," says Hoa. "If you talk to foreign investors or foreign companies in Vietnam, they will say, 'Yes, Galaxy is a company with a sterling reputation,' and that makes me happy. It is very rewarding to build something into the best."

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