Open Next Corporation Strategic Management Analysis

This report provides a strategic management analysis of Open Next Corporation, a leading enterprise information management company. It covers their corporate, business, and functional level strategies, industry life cycle, Porter's Five Forces, and competitive challenges. The report also highlights the importance of industry analysis and factors that impact an industry and the businesses operating in the same industry.

Open Next Corporation
Strategic Management
7/24/2019

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Table of Contents
Introduction................................................................................................................................2
Overview of Open Next Corporation.....................................................................................2
Part A.........................................................................................................................................2
Strategy levels........................................................................................................................2
Corporate level strategy.....................................................................................................3
Business level Strategy......................................................................................................3
Functional level strategy....................................................................................................4
Industry life cycle...............................................................................................................5
Porter Five Force Framework................................................................................................5
Buyers Power.....................................................................................................................6
Suppliers Power.................................................................................................................6
Competition among existing players..................................................................................6
Threat of New Entrant........................................................................................................7
Threat of Substitute products.............................................................................................7
Competitive Challenges for OpenText Corporation..............................................................8
Opentext Strategies................................................................................................................8
Conclusion..................................................................................................................................9
References................................................................................................................................10

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Introduction
The purpose of the report is to integrate and apply the diverse concepts that are
learned up to this point of time. This assessment majorly include the two parts in which part-
A that needs an analysis of an Open Next corporation (as of 30th June 2017) and another part-
B requires evidence that are work on the module activities. The assessment is based on the
analysis of the Open Next by drawing on the case material.
Overview of Open Next Corporation
Open Next Corporation was established in the year 1991. The company is known in
the market for operating in the market of Enterprise Information Management. They are
involved in the development of the enterprise software in order to move towards digital
transformation. The company’s inclusive platform and software products suits offer scalable
as well as secure solutions for the global businesses. Its software guides the businesses with
searching, using, and sharing the information of the business from any of the device in
manner that are in-built, effectual, and creative (OpenText, 2017). OpenText also ensure that
the information remains secure and private, as asked in the present regulated climate.
Part A
Strategy levels
The level of strategy has competition and strategy that allows the business to improve
order to become successful. Three Levels of strategy include corporate, business, and
functional which is followed by OpenText in order to the express that company has the
competencies, resources and capabilities in order to accomplish the goals.

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Corporate level strategy
The corporate level strategy is initial level that outlines the strategy as well as market
in which the company is dealing (David, 2011). The company operated in the Enterprise
information management market in which they offer the services that include business
process management, customer experience management, analytics, business networks and
many others. The company offers the solutions that lead to the exchange of the information as
well as transaction among the supply chain participants that majorly include manufacturers,
retailers, distributors, and financial institutions. This shows that the company has the
capabilities of collaborate effectively with their partners that is the source of their income.
OpenText Company offers the software through traditional on-premise solution, cloud
solutions or combination of both on-premise as well as cloud solutions. This is fact that
company provide the delivery method that is preferred by the customers which makes them
competitive in market. The competencies that are managed by the company against the
competitors include that they are offering customer a choice and flexibility that will help to
strive in maintain the long-term customer value (OpenText, 2017). Mergers and acquisitions
is considered as one of the leading growth drivers corporate strategy and they create the value
by focusing on acquiring and integrating the business for the newly acquired companies as
well as the assets. The acquisition of company as well as assets leads to improvement in the
labour skills, knowledge, and expertise. In addition, not only the human resources but there
are improvement in the financial as well as technology resource.
Business level Strategy
The business level strategy outline at this specific tactics that are adopted by the
company in the market with the fact how the company follow the corporate strategy in order
to form further business level strategy (Wheelen, Hunger, Hoffman & Bamford, 2010).

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Strategic acquisition with the other companies in the market is one of the major
leading growth driver that complement by the organic growth initiatives. The acquisition in
the market helps the company to improve its operational excellence that is possible as
acquisition helps the company to lead in market (OpenText, 2017). This strategic acquisition
leads to the competencies for the company against their competitors, as they are able to
increase their revenue streams with the enablement of the simple expansion across the diverse
new channels with the new markets. The company has the cost-effective centers of the
excellence that will continue in order to enhance the processes with the effectiveness in terms
of cost (Baker, 2014). The company business strategy shows that they have lower cost of
storage as well as management of information that saves their cost of resources that means it
offers them the benefit of financial resources. The cost is reduced in infrastructure also,
which is possible with the improved classification as well as archiving strategies. This low
cost is maintained by the company consistently which shows their capabilities that they
manage the consistency in their business operations.
Functional level strategy
The strategy at the functional level includes the day-to-day strategy that keeps the
company moving in the correct direction (Rothaermel, 2013). It includes the relationship
between the business units, teams, and departments. The functional strategy shows the major
strength of the company that is its research and development that is linked with the
technology developments that are required for the company. The appropriate balance in
managing the organic growth as well as the results of the operation leads to the success. The
capability of the company is that they can improve the existing product in the timely as well
as efficient manner with the motive to form and bring the new products in order to meet the
needs of customer while reducing the total cost of ownership. The major competencies of the

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company are that continue to invest the amount in R&D to bring the new products and
services in the market.
Industry life cycle
Industry life cycle majorly shows the different stages at which the business operates,
progress and prospect in the industry. The major stages of the industry life cycle include start-
up, growth, shakeout, maturity, and decline (Tavassoli, 2015).
The industry of the technology is at growth stage in which they are growing their
business. Considering growth in the industry, this can be said that strategies of the company
are appropriate enough through which they can address all the opportunities and threats. The
company has an opportunity to support the customers to become the digital businesses with
Magellan and Release 16 and the recent acquisitions (OpenText, 2017). Along with this, the
major opportunity is to provide the newly acquired technologies to present customer base.
This can be met by the company with use of effective acquisition strategy as this helps to
offer wide range and meet the needs also to provide the strong customer base. Further, this is
determined that the company has threat of changes in market demands and competitors in
market. This can be easily managed by the company by keeping consistency in their research
and development, growth, improvement in product and many others.
Porter Five Force Framework
Porter five forces is a framework that recognizes and evaluate five competitive forces
that helps in shaping the industry and determine the strategies of the business accordingly.
This framework is mostly used to recognise the structure of the industry for defining the
corporate strategy (Magretta, 2012).

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Buyers Power
The buyers in the industry hold the power to ask for lower prices or higher quality of
the product from the producers when they have strong bargaining power. Low prices of the
products mean low revenues for the business or producers, whereas offer high product quality
increases the cost of the production (Grensing-Pophal, 2011). In the software development
industry, there are increased number buyers but limited number of producers which limits the
bargaining power of the customer in this industry. Here, the strategy of the OpenText
Corporation is to focus on offering high quality software to the customers which results in
increasing the production cost of the company. However, to manage this company’s cost-
effective and scalable centres of brilliance endure to enhance their procedures and cost
effectiveness.
Suppliers Power
Strong power of bargaining enables suppliers to sell products at higher price or low
quality of the product to their clients. This directly impacts the profit of the client because it
has to pay higher price for the materials (Schmarzo, 2015). OpenText Corporation follow the
collaboration strategy under which it manage strong relationship with its manufacturers,
distributors, financial institutions, and other suppliers in order to negotiate strongly over the
prices of the raw material.
Competition among existing players
The software development industry is highly competitive due to increasing
technological change and altering customers’ needs and economic pressures. OpenText
Corporation competes with number of businesses such as International Business Machines
Corporation, Veeva Systems, Microsoft, Oracle, and Adobe Systems Inc. (OpenText, 2017).
In order to deal with these strong players in the market company has adopted the
compensation strategy to attract increased number of experienced and skill staff who could

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get involved in the work and develop new and innovative software and services for the
clients.
Threat of New Entrant
This force of porter framework discusses about how easy or difficult it is to take entry
in a specific industry or market. The software development industry is competitive due to
existing players and the new and innovative business solutions that are being introduced in
the market. To deal with these new players company is focusing on increasing its product
portfolio and offering number of solutions to the clients. For instance, company is involved in
offering increased governance and compliance, process automation and digitization, EIM,
and cloud and hosted services, content services, business process management, customer
experience management, business network, and analytics (OpenText, 2017). This diversified
product portfolio helps Open Next in competing with different players and increasing its
customer base.
Threat of Substitute products
This force is majorly threatening for the businesses in the industry which is comprised
of number of suppliers of substitute products. These substitute products retailer or firms
attract customers by offering attractive prices or higher quality (Hewitt, 2018). The software
development industry is comprised of number of players which offer similar type of products
which results in enforcing customers to switch. In this industry, the clients demand for high
quality product which could help them in increasing their productivity, hence, OpenText
Corporation majorly focus on designing high quality products to attract customers with wide
product range.

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Competitive Challenges for OpenText Corporation
 Company deals with difficulties in attaining the estimated cost savings, business
opportunities, and synergies from the acquisitions
 Challenge in integrating its operations as well as system
 Conforming standards, process, and accounting policies, structure of compensation as
well as business culture
 Business experience challenge in retaining employees (OpenText, 2017)
Opentext Strategies
The two strategic options that are available for OpenText Corporation in the market
are introducing new product and expanding business in new market. In order to follow these
strategic options the below table is highlighting the possible directions:
Strategic
Options
Strategic
Alternatives
Directions Outlook
Introducin
g New
Product in
the Existing
Market
Product
Development
Strategy
Directions in
this strategic
option will be
done by
Manufacturing
Department
The risk that can be faced by business
under this head is lack of quality resources
and skills. The company can overcome this-
By contacting with suppliers that offer high
quality raw material
Hiring experienced Staff
Expanding
business in
New
Market
Market
Development
Strategy
Directions in
this strategic
option will be
done by the
Research and
Development
Department and
Marketing
Department
While planning for the expansion in
different market the company could face
challenge in dealing with political and legal
system of the specific country.
The company can overcome this by
properly analysing the legal requirement of
the country and adhering all acts.

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Part B
The above section has provided a detailed analysis of the Open Next Corporation which is
established in the market for offering enterprise system solutions and other digital solutions
to the businesses. The report section has presented different levels of business strategies of
the company that is corporate level strategy, business level strategies, and functional level
strategies. From the analysis, I realised that the corporate level strategy of the company is to
offers the software through traditional on-premise solution, cloud solutions or combination of
both on-premise as well as cloud solutions. In fact, the company offer excellent solutions to
the business which makes them satisfied and loyal towards it and help in attaining
competitive advantage. Besides this, business level strategies are the tactics adopted by the
businesses to success in the market and in case of Open Next is has involved in different
acquisitions to succeed. In addition to this, the report supported me in learning about the
functional level strategies that is comprised of the strategies used by the business for its day
to day operations. I also learned about the concept of life cycle of the product under which we
discuss about the four stages of a product or service that is introduction, growth, maturity,
and decline. In case of technology industry, it is presently at the growth stage which reflects
that there is huge scope for the businesses operating in the industry to growth and introduce
innovative products and services.
Furthermore, while working on the report I understood the importance of industry analysis
and factors that impacts an industry and the businesses operating in the same industry. From
the analysis, I identified different strategies and frameworks that businesses use for the
industry analysis. One of the industry frameworks is Porter Five force Framework which
talks about five forces that are threat of new entrant, threat of substitute product, bargaining
power of buyer, bargaining power of supplier, and competition among existing players. The
analysis of the framework highlighted that in the technology industry customers has low

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power of bargaining which results in increasing the power of the retailers or businesses to set
the prices of their services and products. However, this industry is intensely competitive
because of technological change and changing needs and demands of the customer and
economic pressures. After identifying that the industry is competitive, it raised need for me to
identify the reason behind it. After the research, from different sites I identified that the main
cause of increasing competition is limited entry barriers due to which increasing number of
new players are taking entry in the industry with their innovative ideas. Along with this, the
technology industry raises challenges of substitute products for the existing players in the
market. While conducting the research over company, I learned that to deal with the threat of
substitute products the businesses differentiate their products from the competitors like Open
Next Corporation offer innovative design and features of its solutions.
In spite of the all the strength and strategies used by the business to survive and lead the
industry it deals with some challenges that needs to be addressed in order to avoid all types of
hurdles in the direction. Some of the challenges that Open Next Corporation experience are
integrating its operations as well as system and retaining employees. In the end, I have
recommended two strategies that can be adopted by the company to grow the business that
are introducing new product in market and introducing business in new market. In all, I
learned about different marketing and strategic management approaches that are mostly used
by the businesses to analyse its strength and challenges that it faces within the industry. In
addition to this, I learned about how to present a systematic strategic report comprised of all
the key aspects that are required to know more about an organization.
Conclusion
In the end, this can be concluded that determination and explanation of strategic levels
that is expressed by the firm. It has been found that all the level of strategy include resources,

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competencies and capabilities for accomplishing goals. This evaluation is explained with the
help of industry life cycle and related strategies that assess the company’s threats and
opportunities and strategies of company are appropriate. In addition, it includes the forces
that can shape the strategies of firms with the evidence available in case material and
strategic management theory. The firms deal with the competitive challenges that are
presented clearly in the report. On the other part, Part-B includes the executive summary of
the related issues as well as theories that are raised in the activities of module.

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References
Baker, M. J. (2014). Marketing strategy and management. London: Palgrave Macmillan.
David, F.R. (2011). Strategic management: Concepts and cases. India: Pearson/Prentice Hall.
Grensing-Pophal, L. (2011). The Complete Idiot's Guide to Strategic Planning: Boost Your
Business with Proven Strategies 1st ed. U.S: Penguin.
Hewitt, E. (2018). Technology Strategy Patterns: Architecture as Strategy 3rd ed. U.S:
"O'Reilly Media, Inc.
Magretta, J. (2012). Understanding Michael Porter: The Essential Guide to Competition and
Strategy 1st ed. U.K: Harvard Business Press.
OpenText. (2017). Annual Report. Retrieved from Case Study.
Rothaermel, F. T. (2013). Strategic management: concepts. New York, NY: McGraw-Hill
Irwin.
Schmarzo, B. (2015). Big Data MBA: Driving Business Strategies with Data Science 3rd ed.
U.K: John Wiley & Sons.
Tavassoli, S. (2015). Innovation determinants over industry life cycle. Technological
Forecasting and Social Change, 91, 18-32.
Wheelen, T. L., Hunger, J. D., Hoffman, A. N., & Bamford, C. E. (2010). Strategic
management and business policy. New Jersey: Prentice Hall.