LCBS5001 Strategic Management: A Detailed Report on Microsoft

This report provides a strategic analysis of Microsoft Corporation, examining the reasons behind its past failures and offering recommendations for future success. It employs the Business Model Canvas, SWOT analysis, and PESTEL analysis to assess Microsoft's current position and identify key challenges. The report delves into the company's failure in the mobile device market, particularly the Nokia acquisition, and evaluates Microsoft's strengths, weaknesses, opportunities, and threats. Furthermore, the PESTEL analysis explores political, economic, social, technological, environmental, and legal factors impacting the company. Finally, the report includes scenario planning to anticipate future challenges and opportunities, culminating in strategic recommendations for Microsoft to enhance its competitiveness and achieve sustainable growth. Desklib offers a variety of similar solved assignments and past papers for students.

Running head: STRATEGIC MANAGEMENT
Strategic Management
University Name
Student Name
Authors’ Note

2STRATEGIC MANAGEMENT
Table of Contents
-Introduction...............................................................................................................................2
- Failure of Microsoft.................................................................................................................3
-Strategic Framework (Business Canvas Model).......................................................................3
SWOT Analysis.......................................................................................................................10
PESTEL Analysis.....................................................................................................................12
Scenario Planning of the firm Microsoft Corporation.............................................................18
-Conclusion and Recommendation..........................................................................................24
References................................................................................................................................26

3STRATEGIC MANAGEMENT
-Introduction
The current study intends to analyse events of failure of firm with special orientation to the
operations of Microsoft. Microsoft Corporation is particularly an American transnational
technology corporation having headquarters situated in Washington. This company develops,
producers, licenses, upholds and markets software, specialised services, consumer electronics
and personal computers. Also, this study at hand also presents strategic framework
particularly (using Business Canvas Model) for conducting strategic analysis. Furthermore,
the company also uses tools such as SWOT analysis, PESTEL analysis and scenario planning
for analysing businesses and identifying the current issue that is the underlying reason of the
recent failure of the firm.
- Failure of Microsoft
The future of Microsoft became uncertain particularly in the manufacturing business.
Therefore, it is necessary to assess the reason behind why Microsoft has struggled to develop
a sustainable mobile apparatus business. In essence, one of the primary complaints about
Steve Ballmer’s period as chief executive of the firm Microsoft was that CEO did not
respond speedily to immense shift to mobile instruments as well as applications. Whilst
Google as well as Apple were establishing to increase their overall efforts, the company
Microsoft was basically in a specific holding pattern (Walker et al. 2014). However, the time
Ballmer responded, the company Microsoft was lagging behind to effectually challenge the
enormous lead Apple as well as Google had attained.
As suggested by Tan and Carrillo (2017), the Nokia deal can be considered to be a nightmare.
The decision of Microsoft to acquire mobile phone business of Nokia for roughly $7.2 billion
is thought to be one of the biggest blunders of the firm. However, after failing to get much

4STRATEGIC MANAGEMENT
value out of the assets or resources of the firm Nokia, the company Microsoft was compelled
to write down approximately $7.5 billion associated to the business transaction and reduced
roughly 7800 jobs. Particularly, the company Nokia was believed to be the corporation that
would improve overall market position of the firm Microsoft (Johnson 2016). Instead, it
became a financial milestone that weighed around overall level of profitability of the firm.
-Strategic Framework (Business Canvas Model)
Three different tools and techniques that can be used to for strategic analysis include the
following:
Business Model Canvas: Microsoft
Key Partners
-Manufacturers
-Wholesalers
-Suppliers
-Telco Corporations
-Foxconn
-Value added resellers
-Distribution Partners
-Retailers
(Scarborough 2016)
-Technology Alliances
-Microsoft is a
founding member of
Open Networking
Foundation
-Microsoft partner
Key Activities
- Product design
as well as
development
-Research and
development
-Development
of software
-Management of
change
-Management of
release
-System of
licensing
-Deployments
-Support for
Value
Propositions
-Brand
-To enhance
overall
productivity at
superior level
-Maker of
world’s largest
software of
particularly
Windows
(Barney 2014)
-Most valuable
corporations
-Productivity as
Relationship with
customers
- Level of trust
-Overall quality
-Overall firm
performance
-Differentiation
- Level of
reliability
- Automation
(whenever
possible)
-Assured sales for
huge accounts
-Assistance
towards customers
Customer
Segments
-Mass Markets
-Business
enterprises
- IT
administrators
-Developers
-Individuals

5STRATEGIC MANAGEMENT
network
-Microsoft joined the
institute Linux
Foundation as
specifically Platinum
member particularly
through Microsoft’s
Connect
-Academic
- Governing bodies
-Acquirements of
Microsoft that include
LinkedIn, Nokia
Devices along with
Services, Hexadite,
Yanner as well as
Mojang and many
others
- The company was
the official jersey
financier of National
Basketball team of
Finland during the
year 2015 at the
EuroBasket.
customers
-Quality Control
-Operations
-Management of
infrastructure
-Sales and
marketing
-Hardware as
well as
electronic
manufacturing
well as business
services
-The business
concern also
delivers a broad
range of other
customers along
with enterprise
software for
particularly
desktops as well
as servers
(Barney 2014)
- Computer
Hardware
(referring to
surface series of
specifically
laplets by the
firm Microsoft)
- Consumer
Electronics
(Windows Phone
and Xbox One
Console)
-Program for the
company’s partner
-Level of
certifications of the
firm
-Community
-Effects of same
side along with
cross side network
-Advantages
available to each
and every group
exhibit call for
economies of scale
Key Resources
- Microsoft can
Channels
-Internet Bing

6STRATEGIC MANAGEMENT
be considered to
be business
enterprise and
the products are
utilized in
roughly every
computer on the
entire world
- The company
can be
considered to be
a symbol of
everything that
is huge
regarding
information age
-Leadership
potential of
particularly
Satya Nadella
-Software
Developers
(Prajogo 2016)
-Bill Gates
operating as a
technology
consultant
-Flagship Stores
-Microsoft Stores
-Microsoft Azure
Market Place
-Worldwide Sales
along with Support
teams
- Multi-product
sales force
(Fleisher and
Bensoussan
2015)
-Business retailers
-Blogging
-Incidents
-Public Relations
-Future Decoded
can be regarded as
a business
networking event
conducted each and
every year by the
firm Microsoft that
permits business
partners of the
business concern to
share their opinions

7STRATEGIC MANAGEMENT
-Sales Force
-Experienced
and specialised
personnel
-Technology
-Data Centres as
well as other
areas of
networking
-Innovation
-Intellectual
Property
(Gerow et al.
2014)
-Determination
-Talent as well
as Corporate
Culture
-The company
Microsoft can
be considered as
the third largest
manufacturer of
mobile phones
manufacturing
approximately
33 million units
-Technical
references for
different
developers along
with articles for
different Microsoft
magazines namely
Microsoft Systems
Journals that are
obtainable through
Microsoft
Developer Network
(MSDN)

8STRATEGIC MANAGEMENT
-The company
has ever more
diversified from
particularly the
operating
system market
and has carried
out a total
number of
corporate
acquirements
Cost Structure
-Development of
software
-Manufacturing
specific hardware
-Acquirements as well
as development
-Marketing as well as
sales (Wu et al.
2015)
-Research as well as
development
-Customer Service
-Members of the staff
-Different projects and
projects of
Streams of
Revenue
-Different
subscriptions
-License fees
-Product Sales of
the business
corporation
-Advertisement
Revenue
-Sales of hardware
-Presented as a
percentage

9STRATEGIC MANAGEMENT
development
-Roadmap of the
product
-Data centres
-Operations as well as
maintenance of
information
technology
(Dzhandzhugazova
et al. 2015)
-Solar Panels more
than 2000 are on top
of the buildings that is
particularly situated in
particularly Silicon
Valley creating
roughly 15% of
overall energy
required by firm’s
facilities
-Different
headquarters
-Taxation

10STRATEGIC MANAGEMENT
SWOT Analysis
Strengths
- Reputed Brand: Microsoft can be considered
to be a multinational firm that functions through
regional subsidiaries. This can minimize cultural
variances in over and above 100 nations.
-Technologically advanced firm: The company
Microsoft can be considered to be a catalyst
functioning in the tech world. Prioritizing
innovation as well as optimization by means of
strong research as well as development action
(Lipman 2015). This functions Microsoft
Research that is one of largest computer science
research corporations that operate in close
collaboration with top notch universities
throughout the world.
-Product Portfolio: The company Microsoft
presents a wide range of software, specialised
services along with hardware solutions across
diverse classes of clientele. This help in enjoying
a foremost position in the market. The company
Microsoft generates revenue by means of
developing, manufacturing, licensing and
upholding software along with services across an
extensive variety of computing instruments. The
company Microsoft also delivers consulting
Weakness
- Legal proceedings: Microsoft can be
considered to be a defendant in different
unresolved cases marked against the same. The
company is currently entangled in different legal
proceedings associating to design of product,
manufacturing and performance liability along
with other litigations associated to agreements,
issues of employment as well as intellectual
property rights.
- Not being able to take charge of counterfeit of
software business in different developing
countries (Horkoff et al. 2014)
-Lagging in the area of innovation: Due to vast
utilization, clientele of Microsoft have a common
grievance that the firm Microsoft keeps
upgrading the product although there is nothing
new from the bottom ups from the reputable
brand. With respect to operating system
capabilities, the firm Apple is considered to be
ahead to be that of Microsoft. Owing to which
Apple is gradually coming up as the selected
operating system.

11STRATEGIC MANAGEMENT
along with support service for products/services.
-Extensive system of distribution: Microsoft
maintains and preserves a strong distribution
along with network for marketing that leverages
various functional performances (Kew and
Stredwick 2017). The firm Microsoft sells and
at the same time distributes products by means of
three different channels that is to say, Original
Equipment manufacturers, distributors as well as
resellers and online
Opportunities
- Transforming to Razor and Blade Model: In
place of offering pricey software can operate on
particularly Blade and Razor Model in a bid to
counter illegal utilization of software mainly
operating system, by means of which they can
generate higher revenue.
- Strategic Alliance: The business concern can
concentrate on entering into new forms of
partnerships for improvement of innovative along
with technologically advanced products (Joyce
and Paquin 2016). This kind of partnerships
delivers a competitive edge and permit to garner
higher share of the market. For instance, during
2014, the business concern pronounced 9 new
hardware partners for Windows Phone. In
Threats
-Level of competition: The market for software
can be considered to be highly competitive that
might perhaps influence overall performance of
the corporation. Essentially, the firm encounters
stiff competition in different segments. The main
rivals in the Windows Live Software along with
services comprise of Apple, Yahoo as well as
Google and many others (Toro-Jarrín et al.
2016). Also, the Internet Explorer encounters
stiff competition from varied browsers designed
by particularly Google (Chrome), Mozilla as well
as Opera Software Company among many other.
Also, the server of the firm along with tool
products competes against the associated
offerings made by Oracle as well as IBM.

12STRATEGIC MANAGEMENT
essence, the partners deliver a direct accessibility
to the tools, widening overall scope for firm’s
customers and launching novel points of prices
across primary growth markets.
-Higher demand of smart phones: The
company Microsoft can capitalize over the
increasing demand of firm’s smart phones that is
emerging as an opportunity for growth in both
developed as well as developing countries
(Aversa et al. 2015).
- Swift Technological Alterations: The tech-
world is constantly altering. Business concerns
are finishing up killing their own offering before
competition destroys the same.
-Pirated Market- It is the most important threat
that the company encounters in the segment of
software. Each and every year, Microsoft loses
billions owing to flow of pirated versions across
the entire world. The firm Microsoft loses
considerable amount of revenue due to rate of
piracy of over and above 30% in several nations.
Furthermore, developing countries such as China,
India and many other accounts for key market
that are engaged in illegal utilization of Microsoft
software (Amanullah et al. 2015).
PESTEL Analysis
Managers of the firm Microsoft Corporation comprise of PEST Analysis in their approaches
to comprehend business situations of the corporation.
Political Factors:
This segment of PEST analysis model manages impacts of the government on the remote else
wise macro business environment of hardware as well as software business of the firm.
However, in case of firm Microsoft, the following political external facets can be considered
to be strategic decision making:-