A Strategic Management Report : Microsoft Corporation

Added on - 22 Nov 2020

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STRATEGICMANAGEMENT
Table of ContentsINTRODUCTION...........................................................................................................................3COMPANY OVERVIEW...............................................................................................................3Philosophy of Microsoft.........................................................................................................3Current Business Scenario......................................................................................................3TASK 1............................................................................................................................................4Porter's Five Forces Model.....................................................................................................4TASK 2............................................................................................................................................7Porter's Generic Strategies......................................................................................................7TASK 3............................................................................................................................................9Recommendation....................................................................................................................9CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................11
INTRODUCTIONStrategic Managementis a continuous process of an organisation to plan, monitor,analyse, assess and evaluate everything which is important for a company to meet its businessobjectives effectively(Doz, 2017). It is imperative for companies as it allows a firm to assessfuture opportunities and apply necessary plan of action to acquire these in a healthy and fosteringway. The report below is based on Microsoft Corporation, which is a multinational companyheadquartered in Redmond, Washington. It covers identification as well as critical analysis ofissues related to the strategic management of the company. The report undertakes certain theoriesand their applications which help in determining the ways in which Microsoft couldappropriately implement effective strategic management.COMPANY OVERVIEWMicrosoft Corporation is consideredas one of the biggest technological companies in theworld. It was founded in 1975 by Bill Gates and Paul Allen. The firm has a range of businessoperations(Grunig, 2013). It undertakes developing, manufacturing and selling computersoftware, electronics and personal computers. The firm has its market all around the world and isconsidered one of the most trusted companies of all time in terms of speed, reliability andperformance.Philosophy of MicrosoftThe vision of Microsoft is to make people and businesses realise their full worth andpotential by their products. The mission statement of the firm emphasises on the worldwidereach that the company aims to achieve. Basically, the agenda of the company is to empowereach individual and organisation so that they could effectively accomplish more and progressfurther(Hahn, 2013).Current Business ScenarioCurrently, Microsoft is a leading player in many electronic sub-sectors where othercompanies are struggling to make a mark. In 2018, the firm crossed $100 Billion mark byearning $110 Billion revenue(Hair And et. al., 2012). The firm has a huge global market and iscontinue to make an effective use of technology and enhancing its capabilities. The variousaspects and creations by the company had a huge role in such effective performance of the firm.
“Commercial cloud”, for instance, is a category that is developed by Microsoft whichincludes Office 365, Azure, Dynamics 365 and so forth. The firm has focused its strategytowards enhancing performance of cloud computing. Another sources of its performance wereWindows Pro, Surface and LinkedIn. In addition to this, the firm has effectively managed to stayfirm in terms of Gaming by earning a worth of almost $10 Billion (Microsoft Annual Report2018, 2019).However, each company is required to develop and implement strategic management inorder to stay ahead in the market and enhance their effectiveness(Hill, Jones and Schilling,2014). Microsoft, before developing the strategies, must conduct a detailed analysis and criticalevaluation of the industry. The reason behind this is that such analysis provides a clear pathwayof the potential threats as well as opportunities for the firm that help them in conducting betterstrategic management. For this purpose, Porter's Five Forces Model is an appropriate approachfor Microsoft to analyse the industry.TASK 1Porter's Five Forces ModelMichael E. Porter developed this model in his 1980's book named, “CompetitiveStrategy: Techniques for Analysing Industries and Competitors”. After that, this model till datehas been widely used to determine the structure of the industry as well as company's corporatestrategy(Hill, 2017).According to Porter, there are five competitive and effective forces that shapes a marketand industry. These forces help in analysing each and every aspect from intensity of competitionin the market to attractiveness and profitability of an industry. These forces are, Threat of NewEntrants, Power of Suppliers, Power of Buyers, Threat of Substitutes and Competitive Rivalry.All these factors have an impact on the industry and could be effective factors for a firm todevelop its strategies to ensure long term sustainability and future growth(Hitt, Ireland andHoskisson, 2012). Microsoft could effectively use this model to determine profitability andindustrial attractiveness. This model in context with the firm is described below:Power of Suppliers:Suppliers are the individuals that provide the firm with effective materials andcomponents to help them conduct their business operations in an appropriate and better manner.
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