5
Microsoft Corporation
I. Strategic Profile and Case Analysis Purpose ()
Microsoft company one of the largest technology companies in the world. Bill Gates and Paul Allen founded the company in 1975. Currently, Microsoft’s company chief executive officer is Satya Nadella. Microsoft corporation has its headquarters in Redmond, Washington, United States. Microsoft company has continuously improved its financial performance over time. Microsoft company has continuously recorded an increase in revenues over the years. According to last financial year, Microsoft company recorded total revenue of $168.088 billion, an increase from $143.015 billion recorded in 2020. The company has recorded a net income of $61.271 billion. Microsoft company deals in several products, including software and electronics.
II. Situation Analysis ()
a. General environmental analysis ()
Microsoft corporation is affected by environmental factors, which are political since the company operates in different countries across the world. Economic and socio-cultural factors have a significant effect on the performance of Microsoft corporation. Economic and socio-cultural factors have a significant effect on the number of sales made by the company. The corporation abides by the legal procedures of the countries in which it operates by following the laws concerning waste disposal.
b. Industry analysis ()
Microsoft corporation is the global leader in technology. Technological products of Microsoft companies, such as Microsoft Office, and Microsoft Windows, among other Microsoft software, have remained in the technological industry. Recently Microsoft personal computers sales have increased, and demand for
c. Competitor analysis()
Microsoft corporation faces competition from several companies. Among Microsoft’s competitors includes Apple, Google, HP, Oracle NetSuite, Sony, IBM, and Samsung, among many other companies. Microsoft faces competition in all products which the company produces for the market.
III. (SWOT Analysis
Strength of Microsoft
Microsoft has a Large number of customers across the world. Microsoft corporation has over 75 million customers across the globe. Microsoft company has the second-largest market share and high market capitalization. Microsoft corporation sells products in many countries across the globe, and the company has been experiencing constant market growth. Microsoft’s brand has earned a high reputation across the globe, which makes the demand for the company’s products high.
Weaknesses
Cybercrime activities have negatively affected window operating systems. There is little innovation in Microsoft corporation compared to the company’s competitors such as Apple, Google, and even Amazon.
Opportunities
Partnership and acquisitions. Microsoft Corporation has an opportunity to enter into partnerships with other companies or acquire other companies for its growth. The development of cloud-based software services is another key opportunity for the company to invest. Carry-out innovations and investment in artificial intelligence and diversification of several company products is another key opportunity in which Microsoft company can invest.
Threats
Microsoft company faces threats that include cybercrimes and piracy, changing customer preferences, stiff competition, and workforce-related criticism.
Microsoft corporation is a profitable organization. The company registered an operating profit margin of 36.38% net profit margin of 38.50%. The company recorded a return on assets of 21.6%, which indicates that every dollar spent on assets could generate 21.6 cents. The company’s current ratio of 2.25 indicates that the company has high liquidity. The company can meet all its current liabilities.
IV. Strategy Formulation (Remember Chapters 4-9)
a. Current Strategy— Business-Level and Corporate-Level Strategies, M&A, Alliances
b. Microsoft’s current corporate and business strategy expands through innovations to achieve market excellence. Microsoft corporation aims to expand to different markets across the world.
c. Strategic alternatives to the strategies in (a) above
The strategic alternative of Microsoft corporation is to expand through mergers and acquisitions.
d. Alternative evaluation (different from what is currently being used by the organization, if applicable)
The alternative for Microsoft corporation is to expand through diversification by introducing new product lines.
V. Strategic
a. Action items
Establish an organizational committee to assess the feasibility of acquisition and merging.
Development of research plans
Choosing leadership of groups
b. Action plan
Identify the company for potential merger or acquisition.
Meeting with the organization’s leadership
Carrying out the valuation of the company.
Sign Acquisition documents and make payment for acquisition value.
References
Bakhshi, Z., Balador, A., & Mustafa, J. (2018, April). Industrial IoT security threats and concerns by considering Cisco and Microsoft IoT reference models. In 2018 IEEE Wireless Communications and Networking Conference Workshops (WCNCW) (pp. 173-178). IEEE.
King, R. K. (2004). Enhancing SWOT analysis using triz and the bipolar conflict graph: a case study on the Microsoft Corporation. Proceedings of TRIZCON2004, 6th Annual Altshuller Institute, 25-27.
Warner, J. P. (2019). Microsoft: A Strategic Audit.
