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Strategic - DFFDS
Rhythmic Activities (PE002)
University of Caloocan City
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CINCO, ZHARINA MAE A.
BSTM 2A
CBM 002 ACTIVITY#2 MIDTERM
CASE STUDY
International Business Case Study Microsoft
I. Current Situation.
A. Environment.
- Economic.
According to Microsoft (2017), the industry is dynamic and highly competitive, with frequent changes in both technologies and business models. Each industry shift is an opportunity to conceive new products, new technologies, or new ideas that can further transform the industry. It is therefore important to push boundaries of what is possible through a broad range of research and development activities that seek to identify and address the changing demands of customers and users, industry trends, and competitive forces.
- Cultural and social.
Nadella started to overhaul Microsoft’s organizational culture in early 2014. Very soon, it was evident that he would chart his own course in the company and not rely on things that had made Microsoft a great hit in the 1990s. “Our industry does not respect tradition – it only respects innovation,” he quipped. One of his first actions was to ask his company’s top executives to read Marshall Rosenberg’s Nonviolent Communication, which emphasized empathic collaboration.
The Ethics & Society team at Microsoft gained some valuable insight from this endeavor. First, for more than three months, each member of the team was assigned to lead weekly seminars and instructional sessions. They served the objective of assisting each employee in comprehending the new responsible AI commitment and how it linked to their day-to-day duties inside the organization.
- Political and legal.
Microsoft has potential to enhance its investments and corresponding performance due to the political stability of most markets globally. On the other side, Microsoft has potential to enhance its computer technology sales through governmental clients as a result of the growing governmental backing for automation. When it comes to huge transactions involving governmental agencies, this external aspect is important. Additionally, the growth of global trade agreements creates a distant or macro-environment that encourages an increase in Microsoft's sales across the board.
B. Industry
- Definition.
Microsoft Corporation is an American multinational technology company, which develops and sells a wide range of consumer and enterprise software, hardware, services, and electronics. Founded by Bill Gates and Paul Allen in Albuquerque, New Mexico, in 1975, the company is currently based in Redmond, Washington. (Statista, 2017)
- Classification.
The technology industry provides a vast array of goods and services to both consumers and other companies. All consumers have access to the most recent technology thanks to the ongoing upgrades and improvements made to consumer items like televisions, stereos, and computers. Software and database systems provide information and services to businesses, enabling them to make critical business choices.
In another article, Investopedia (2017a) divides the "tech industry" into a few subcategories, including mobile payment systems, entertainment media, and personal computers. These can also be categorized under:
Personal computers: Apple, Dell, Acer, HP, Sony, and Toshiba are the top rivals in this market.
Mobile devices: Apple, Alphabet Inc. (GOOG), Samsung, and Nokia are rivals.
Smartphones: The Canadian juggernaut BlackBerry Limited (BBRY) formerly controlled this sector (formerly Research in Motion Limited). With the release of the Apple iPhone, that swiftly changed. BlackBerry's business model has been completely destroyed by the iPhone, leading to many company restructurings. The Android operating system is created by Alphabet Inc.'s Google and is found on the majority of non-Apple phones made by Huawei, Samsung, Sony (SNE), HTC, Lenovo, and other manufacturers.
Entertainment media and applications: Apple and Google are the two main participants in this market, with Apple's iOS powering its iPhones and iPods and Google Android powering the majority of rival smartphones and tablets. Users may buy music, books, software, and other products through the App Store and the Google Play Store, which are interfaces with each operating system, respectively.
Mobile payments: Although Apple only started operating in this sector in 2014, it has already established itself as a major player. Apple Pay now has more users than "all competitors combined," according to CEO Tim Cook, after adding more than 1 million in the first 72 hours. PayPal and Google are major rivals in the mobile payments sector. Fintech researchers' study indicates that Apple Pay, which has 86 million users as of April 2017, is the market leader in mobile payments. Comparatively, Android Pay has 24 million users, while Samsung Pay has 34 million.
revolutionizes how people interact, work, and play. We create and promote software, services, and hardware products that provide people's lives additional opportunities, convenience, and value. We operate internationally and have offices in more than a hundred nations.
In addition to inventing and selling hardware items, we also create, license, and support a wide range of software products and services. We also supply pertinent web advertising to a global clientele. We provide suites of products and services in addition to selling individual goods and services.
- Constraints.
You may impose limitations on how Microsoft Project determines task start and completion dates by using constraints. When you need to consider outside considerations, such resource availability, you might need to do this. Setting a deadline for tasks is another feature provided by Microsoft Project.
- Management philosophy.
Microsoft’s mission is ‘to enable people and organizations throughout the world to do more and achieve more by creating technology that transforms the way people learn, work, play, and communicate’. Microsoft employs approximately 114,000 people on a full-time basis; 63,000 in the US and 51,000 internationally. Its business strategy can be classified as product differentiation. The company develops advanced technology products and services and sells them for premium prices. Moreover, Microsoft business strategy is currently focused on ‘cloud-first, mobile-first’, growth through mergers and acquisitions, and exploring business opportunities related to augmented and virtual reality. (Research Methodology, 2017)
- Strengths.
Global leadership in cloud sector Effective leadership by Satya Nadella High profitability of the business and solid financial position Diversified product portfolio
- Strategic collaboration with other companies in e-commerce and IT industry
Microsoft Corp. (Nasdaq "MSFT") announced a number of new relationships with industry heavyweights at Microsoft Convergence 2015 that would assist companies in enabling data culture inside their organizations and providing crucial insights to help provide outstanding customer experiences. Ford Motor Co. and Microsoft are collaborating to provide connected services for clients globally through the development of the Ford Service Delivery Network, which is supported by the dependable and scalable Microsoft Azure cloud computing platform. New connection services that keep Ford and Lincoln owners better informed and in charge of their vehicles at all times will be convenient for them. Ford can swiftly provide new connected features to the market, scale up worldwide availability, and give flexibility for future consumer offers by constructing the cloud-based Ford Service Delivery Network on the Azure platform.
- Weaknesses.
Lack of innovation Weak position of Internet Explorer browser application Occasional technical issues with Windows updates Dependence on hardware manufacturers Security issues of Microsoft products
- Structure.
Microsoft has a divisional organizational structure. The decision by top management to align with the firm's strategic goal as a productivity and platform company led to a restructure that produced this structure. Microsoft terminated 7800 positions in July 2015 and deducted $7 billion from the value of the Nokia acquisition. 2017 (Techcrunch)
The organizational structure is organized into sections based on the engineering groups and business operations. The following graphic illustrates the split of the engineering groups into four divisions and the business functions into nine divisions. The ability for group leaders to report directly to CEO Satya Nadella thanks to this structure may have some effects on product creation and development. According to Research Methodology (2017), this structure essentially gets rid of bureaucracy in company processes and procedures, increasing the organization's flexibility to adjust to changes in the external market. It has been observed that eliminating jobs can result in financial savings that can be applied to the creation of new goods.
- Culture.
and Volvo to install Microsoft HoloLens and the Windows Holographic platform, transforming the way they work by breaking down the barriers between virtual and physical reality.
- Weaknesses.
Microsoft's primary flaw is its lack of innovation. There have been reports that a significant installed base of outdated Windows XP and Windows 7 machines is now being used by individuals. Despite Microsoft almost abandoning Windows XP, its most reliable operating system ever, these users appear content at the moment. Since the market hasn't offered them any compelling reasons to upgrade, they are momentarily content. In other words, Microsoft has fallen behind its key rivals Apple and Samsung in terms of delivering novel products and services as well as integrating innovative features and capabilities into its present portfolio of goods and services. While rivals have been busy releasing novel devices like the Apple Watch and the Samsung SMART, in recent years, Microsoft has not introduced any ground-breaking goods or services.
- Target market(s).
Microsoft Project is intended for users who, at the very least, have a basic understanding of project management principles and who now hold or are seeking for responsibilities requiring frequent use of Microsoft Project to develop project plans, monitor progress, and present outcomes. Product considerations.
- Promotion considerations.
The manager, his or her fellow managers, and skip-level managers vote on promotions. In essence, the manager makes a recommendation for you to be promoted, and the other managers and skip manager judge whether it will be approved.
- Pricing considerations.
The appeal and sales success of Microsoft's goods are impacted by price points. To solve issues with this component of the marketing mix effectively, the business must use appropriate pricing strategies. The following pricing techniques are employed by Microsoft:
Pricing approach focused on the market Pricing model for freemium Pricing strategy: Buy Only What You Use
- Channel considerations.
Based on the case discussion, it appears that Microsoft is modeling its stores after those of Apple. As a competitive reaction to Apple's retail lead, this is a smart move for Microsoft to take. However, they need still develop their own model that works well with their current marketing and business objectives. They do this to avoid any potential consequences that an incompatible channel strategy could have on the aforementioned tactics. Therefore, in order to effectively compete with Apple and its products, Microsoft must have comprehensive and compatible distribution targets for their retail outlets.
- Information and research considerations.
In their hunt for answers, researchers also looked to the larger research community. They collaborated academically on pandemic preparedness-related themes to find ways for people to survive and thrive after these trying times. Microsoft has published a number of publications that examine worker productivity and well-being by taking into account a range of data, including research from throughout the business. Improvements to Microsoft productivity products that are now available and coming soon, such as Together mode, virtual commuting, and Teams' meditation experiences, are being made as a result of the findings (the latter two features roll out next year).
- Managerial capabilities.
The success of this project was aided by the strong collaboration between engineering, the landing and adoption team, and Microsoft Digital. According to Neirynck, "Our staff are well-versed in their respective fields, technically competent, and aware of the benefits associated with each function.
Mapping the stakeholder groups and delivering a customized, unified message to them while being ready to answer queries was another crucial piece of the jigsaw. The group developed action plans in such areas as delivery, adoption, and business preparedness, recorded its learnings, and attempted to foresee potential barriers.
E. Assumptions about current situation.
A. Alternative 1.
- Strengths and benefits.
Microsoft is an undisputed leader in the global marketplace in the cloud segment. Microsoft offers a wide range of cloud-based computing services that include Bing, Microsoft Azure, Microsoft Dynamics announcement of plans by Satya Nadella that Microsoft will be earning USD20 billion per year from cloud business by 2018 is a clear illustration of further commitment of the company to further increase its presence in highly profitable cloud business. Microsoft has maintained its leadership position in the cloud segment according to the amount of revenues for the last several years, followed by Amazon, Salesforce and Oracle. Leadership in cloud segment is a major strength for the multinational technology company, taking into account its increasing popularity and long-term growth prospects.
- Weaknesses and costs.
B. Alternative 2.
- Strengths and benefits
Effective and visionary leadership by Satya Nadella is one of the factors that sets apart Microsoft from competition in positive terms. Since taking over from Steve Ballmer as Microsoft CEO in 2014, Nadella has been bold and effective in restructuring and reinvention of the company. Initiatives introduced by Nadella such as refocusing Microsoft ‘s mobile-based efforts and expanding many of its services to be offered on other platforms like Mac have proved to be effective up to date. It has been noted that the leadership principles of Satya Nadella are based on the values of learning, choosing to create a positive impact, finding ways to innovate and making meaning a priority.
- Weaknesses and costs
Loss of leadership position in internet browser segment is a noteworthy weakness associated with Microsoft. Microsoft’s Internet Explorer was a leading browser application with market share of more than 90% for about two decades since the beginning of the 1990s. However, Internet Explorer has been quickly losing its market share since the launch of Google Chrome in September 2008. Microsoft market share in internet browser segments accounts for only 20% and the leadership spot has been lost to Alphabet’s (Google) Chrome, which possesses 42% of the global market share.
C. Alternative 3.
- Strengths and benefits.
In fiscal year 2016, Microsoft generated USD 85 billion in revenue, USD 52 billion in gross margins, and USD 20 billion in operating income. Commercial cloud annualized revenue run rate exceeded USD 12 billion, up more than 50% year-over-year. Moreover, during the last financial year, revenue from the cloud platform Azure grew triple digits, with usage of key computing and database workloads more than doubling year-over-year. Microsoft’s high level of profitability and the solid financial position of the company is a considerable strength from multiple points of view. In particular, the solid financial position of the business can play an instrumental role in terms of facilitating new product development with positive implications on the long-term growth of the business.
- Weaknesses and costs.
Occasional technical issues with Windows updates is another weakness related to the Microsoft brand. There are number of occasions where Windows updates caused technical disadvantages to users with negative implications to the brand image. The most notable case is the Windows 7 update of KB 3004394 in December 2014 that automatically blocked the installation or update of graphics drivers such as AMD’s new Catalyst Omega and caused difficulties in installing GeForce drivers and a set of other drivers and software. Such user inconveniences have inevitable negative implications on brand image. More recently, ‘Microsoft has advised Windows 10 users against downloading the Creators Update before their computers become eligible for it. The company released the new software two weeks ago, but has decided to roll it out to users in stages, partly because it doesn’t want to overwhelm its servers.’
IV. Decision and Implementation.
A. What.
Microsoft's decision-making and communication processes are not much different from those of other businesses in a comparable industry. The CEO and other senior officers determine the company's strategy, goals, and directives at the outset of the decision-making process.
B. Who.
Applying these objectives to their purviews is the job of department leaders. It is the responsibility of managers to clarify these objectives to their staff members so that they may get to work on achieving them. As a result of the formal nature of the communication system, duties are gradually delegated from top to bottom, and employees primarily interact with their immediate supervisors.
C. When.
Additionally, they've had better success holding training sessions on the company's meeting-free Fridays, which are particular days set aside for workers to catch up on email or spend time studying.
A Californian consultant named minute stop initially described the renowned retail business as a
store where everyone stops by for a minute. Later on, the name changed to MINISTOP when the
Japanese-owned firm chose to make it less of a tongue twister.
The AEON Group of Japan, MINISTOP's parent firm, has sponsored several environmental initiatives in
which MINISTOP has taken part. MINISTOP has been planning franchisee tree-planting excursions since
- More towns where MINISTOP is located are included in the commitment to quality.
The firm boasts of "Customers first" as a practiced policy despite more than 20 years of success in the
convenience store market. This has served as the company's guiding philosophy for all business activities
at MINISTOP. The firm has harmoniously built its business only on the perspective of the customer,
aligned with this attitude. The firm has established itself as a leader among other convenience shops not
only in Japan but also in the Philippines as a result of its dedication to customer-focused management.
The Philippines welcomed the Japanese brand of convenience store Ministop in December 2000.
Robinsons Retail Holdings, Inc., Ministop Japan, and Mitsubishi Corporation were partners in bringing
the company to the Philippines. With 460 outlets in the Philippines, the Ministop company was fully
acquired by Robinsons Group in January 2022. The outlets will be given the Uncle John's moniker, which
is the name of the company's signature fried chicken item that has been offered in the Philippine market
since 2006. Robinsons Retail Holdings, Inc, which acquired the Ministop Philippines franchise in February
2022, would change the name of all Mini Stop locations in the Philippines to "Uncle John's" by 2023.
In conclusion, in order to concentrate its efforts on its home market, the Japanese convenience store
franchise firm Ministop is leaving the Philippines and selling all of its joint venture shares to Robinsons.
Strategic - DFFDS
Course: Rhythmic Activities (PE002)
University: University of Caloocan City
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