Situational Analysis of Microsoft Corporation

This article provides a situational analysis of Microsoft Corporation, including the market environment, buyer behavior, micro and macro environmental analysis. It discusses the company's background, buyer behavior, strengths, weaknesses, opportunities, threats, and the impact of political, economic, social, technological, legal, and environmental factors.

Running head: SITUATIONAL ANALYSIS
SITUATIONAL ANALYSIS
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction................................................................................................................................2
Company Background................................................................................................................2
Buyer Behaviour........................................................................................................................3
Micro Environmental Analysis..................................................................................................4
Summary of the Analysis.......................................................................................................6
Macro Environmental Analysis..................................................................................................7
Summary of the Analysis.....................................................................................................10
Conclusion................................................................................................................................10

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Introduction
Situational analysis is one of the major aspect that is related to analysis of the
organization. This analysis will be contributing to the development of the aspects that are
related to the environment of the business (Proctor, 2014). This study will be projecting the
analysis of the market environment in a competitive environment. The study will be
projecting the macro and micro environmental analysis of Microsoft Corporation along with
stating the buying behavior of the consumers for the development of a new market. It is one
of the tech giants in the whole world. Being responsible for various innovating products it is
necessary to understand their position in the market to get the details of their current
positioning. Situational analysis of the organization is one of the most important aspect that is
related with the development of the aspects that will be contributing to the organizational
enhancement (Kotler et al., 2015). This is one of the most important aspect that is related to
the development of the factor that is liable for the contribution in gaining a competitive
advantage. The study will be consisting of the analysis of the various aspects that are related
to the micro and macro environmental attributes. The study will be stating about the
background of the company and then project the analysis of the micro and macro
environments.
Company Background
Microsoft Corporation is one of the giants in the field of technology. Founded in 1975
by Bill Gates, it is one of the tech giants who are involved in the process of advancement in
the sector of technology. This is a company with an annual revenue of $110 billion and
products like Bing, Cortana, Windows and Office (Microsoft.com 2019). It is one of the most
influential giants in the industry of technology (News.microsoft.com 2019). However, there

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is a significant competition from the players such as Apple, Google and Samsung for the new
Surface devices for Microsoft while creating a separate market for them.
Buyer Behaviour
Buying behaviour for company is one of the most significant aspect that is related to
the growth of the organization. It is important for the organization to be involved in the
process of determining the needs of the consumers (Horner & Swarbrooke, 2016). There are
four key types of buying behaviour that is associated with the buying behaviour of the
consumers.
Complex Buying Behaviour: This is the buying behaviour when the consumer has to do a
highly informative research on the product. These buyers are involved in the process of
seeking more information about the product (Aarikka-Stenroos & Sakari Makkonen, 2014).
Variety Seeking Buying Behaviour: This is the behaviour that has been detected by various
brands. The buyers associated with this type of behaviour is concerned about the variants of
the product but they are not concerned with the brand and company (Legohérel, Hsu &
Daucé, 2015).
Dissonance-reducing Buying Behaviour: This buying behaviour does not include the
aspects that will be responsible for a less variety seeking buyer and less involved in the
process of seeking information. However, there is significant involvement of the buyer in this
process (Wicklund & Brehm, 2013).
Habitual Buying Behaviour: This type of buying behaviour can be observed when it has
been detected that the buyer in less involved in the buying process and there is minimal
differences between the brands that the buyer is seeking (Pandey, Pandey & Bahl, 2013).
From the above stated behaviour customers of Microsoft Products are mostly
knowledgeable about the product that they are choosing. While buying the products that are
mainly focused in the technological aspects and it is important for the consumers to get

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involved in the process of buying and get as much as information possible for the products
(Rani, 2014). The buying behaviour for the Microsoft corporation product does include the
aspects that will require informative approach which is one of the major reason for the
complex buying behaviour among the consumers. It is one of the major duty for Microsoft to
make the consumers engaged which will increase loyalty for the brand and help the brand to
grow for their new Surface devices such as laptop, tablets and headphones.
Micro Environmental Analysis
Micro environmental analysis is one of the major aspect that ca influence the
organization. These factors are inclusive of the aspects that are related to the strengths,
weakness, opportunities and threats. The analysis of the micro environmental factors of
Microsoft Corporation is stated below:
Strength: The strength of Microsoft Corporation is well known to the world. The key
strengths of the company is it is one of the leading company y in the software developing
sector. Microsoft is the 4th largest company with a market value of $750. Billion. Their
operation in more than 190 countries is a significant reach for the company to be involved.
The growth of Microsoft is suggesting that it is soon to touch the $1 Trillion mark of market
valuation. This is one of the most reputed brand known for their office suite and Windows
Operating System platform. The brand is one of the most significantly reputed brand. They
are also known for their quality products in the market. Suppliers like Intel who are involved
in providing them with the processors for their products is one of the major strength of the
company. However, the brand value of the company can lay a good platform for the new
surface platform of the company.

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Fig: Brand Value
Source: Satista.com 2019

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Weakness: There are many strength of the company in technological advancement. However,
there is significantly weak spots for Microsoft. One of the weak points for the company is
their exposure to the personal computer market. Their products are mostly focused on the
personal computers whereas there is existing trend of mobile devices (Marback et al., 2013).
The cyber security is also a threat for the company as there are numerous hackers involved in
the process of hacking Microsoft.
Opportunities: There has been significant growth in the sector of technology. Presently
growing cloud based systems have been an opportunity for the tech giants. There is another
opportunity as it has been seen in the sector of artificial intelligence is one of the most
growing sector in the technological advancements. It has been also observed that there is
significant approach to gain the cost leadership that will be ultimately result in the
development of the organization. This is one of the most important factor that can be an
Fig: Windows Market Share
Source: Satista

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opportunity is the trend of mobile devices. Their surface devices that impact the growth of the
company.
Threats: There has been significant impact on the company with the workforce related issues.
In present times it has been observe that there is significant issues on the aspect that are
related to the diversity of the workforce. This has been one of the major threat in terms of
brand image in the public domain (Gawer & Cusumano, 2014). The competition from the
companies like Apple and Google has been one of the significant threat to the company with
the rise of Android and iOS. Microsoft’s major products windows and office suite is threaten
by the open source competitors like Linux and Libra Office. Piracy and cybercrime has been
one of the most significant threat to the company. There has been significant competition
from the players such as Apple, Google and Samsung.
Summary of the Analysis
This analysis of the micro environment has revealed that there is significant issues
with the company but still it is one of the most influential company in the world and also in
the sector of technological innovation. The analysis of such environment reveals that there is
significant potential for the growth in the innovation with the resources that the company is
possessing. The target of Microsoft is one of the major part for the computer user but this has
changed over the time now competitors like google is involved in the process of developing
the features that will be contributing to the usage of devices that are movable in nature.
The segment for Microsoft is based on the usage of the customer that will be allowing
the surface products to reach to the correct customer. The segment of the company is
inclusive of various sectors such as laptops, 2-in-1 laptops and accessories for the customers.
The segment of operation is in technological as it helps in the development of the factor that
will be contributing to the aspects that are related to the development of the factors that are
associated with organization. The target market is based on the usage behaviour of the

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customers as the company is focused on the people who are using computer devices in a
mobile platform and smartphones.
Macro Environmental Analysis
Macro environment is one of the most significant aspect that can contribute to the
development of the factors that are associated with the development of the factors that will be
liable for the contribution to the environment that are mostly consisting of the aspects that
are external such as political, environmental, economical, social, legal and technological.
This is one of the most important aspect that is associated with the development of the factors
that will be contributing to growth of the organization. The analysis of the macro
environmental factors is stated below.
Political: There has been significant participation in the adopting the public policies such as
privacy protection and other laws. Increasing trade agreements can impact the company by
increasing the competition and allowing the other companies to enter the market
(Datacatalog.worldbank.org, 2019). These agreements also impacts the whole organization as
it helps the companies to get engaged with the activities that will be impacting their
expansion activities. Though there has been significant impact after the violation of the
antitrust has been a significant impact for the organization.
Economic: Stability of the economy is one of the key factors that are associated with the
development of the organization. Australia being one of the growing economy it is an
opportunity for the organization to utilize such economy. The presence in the developing
nations are one of the most significant step that can contribute to the growth of the
organization. The economical factors that can impact the organization are the gross domestic
product of the country, economic stability of the country (Reserve Bank of Australia, 2019).
However, there is another economical factor that have impacted the organization is that the

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growth in the disposable income of the household. It is one of the most important aspect that
can influence the organization.
Social: There are significant social effects that can impact the organization as it has been seen
that there are significant aspect that are associated with the development of the factors that
will be responsible for the organization. One of the most common effect that have been seen
by the organization is the technological advancement and people being aware of these
advancement. The present generation is curious about the mobile usage and this has a
significant impact on the organization. The increasing reach of the computer and exposure to
the culturally diverse people is one of the significant aspect that is related to the development
of the product. It is one of the most important aspect that is associated with macro
environmental issue.
Technological: Microsoft is one of the most significant brands that has ensured their
sustainability in the industry with incorporating the technological advancements throughout
the course of their business cycle. One of the most significant aspect that is associated with
the increasing use of the mobile technology. There is another technological change that can
impact the business is that the rapid growth in the online transactions when this can help the
company to reach various customers, it increases the vulnerability of online scams. This is
one of the most important aspect is associated with the organization. Trend of the using
mobile devices are increasing day by day which is a positive for the company.

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Legal: With increase in the usage of the mobile devices it has become a significantly valuable
for the company to abide by the regulations that are being laid by the government for efficient
disposal of the electronic waste (Golev et al., 2016). This is one of the opportunity for the
company to get indulged with recycling and promoting the sustainability of the natural
environment. Another crucial part for Microsoft is the regulations regarding the privacy laws,
which are currently evolving day by day (Oaic.gov.au, 2019).
Environmental: Environmental sustainability is one of the vital trend in the world that is
associated with protecting the nature (Bachoo, Tan & Wilson, 2013). This is one of the major
contributor towards the development of the key area that will be responsible products that
will be more environment friendly. The availability of the recycled materials also is one of
the most significant factor that can contribute to the sustainability of the environment and
become an opportunity to utilize the recyclable materials.
Fig: E devices Trend
Source: Satista

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Summary of the Analysis
From the analysis of the macro environmental it has been observed that there have
been significant factors that shows a positive platform for the new surface products.
Analyzing the PESTLE it has been observed that there is a significant factor that will be
liable for the creating a market for the surface products of Microsoft. There are significant
opportunities for the company, however it has been observed that there is a significant aspect
that is related to the competition from the likes of Apple and Samsung who are already
offering products like MacBook, iPad and Samsung Notebook. However, the company does
have an opportunity in terms of the PESTLE analysis
Conclusion
It is one of the most significant aspect for the organization to get involved in the
process of creating a differentiated product that will be helpful for creation of a market. This
is one of the most significant part for the organization that will be liable for the development
of the key features that are associated with the product that will be beneficial for the product
to get the desired success from the customer. To conclude, this study states about the various
aspects that are related to the creation of a market that is being impacted by the organization.
Thus, it is vital for the company as big as Microsoft to analyze such factors and get the
desired results done.

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