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Strategic management for microsoft
Strategic analysis of microsoft
Corporate strategies of Microsoft Corporation
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Introduction
This essay plans to focus on the corporate strategy of Microsoft, and show how Microsoft has used diversification successfully within their corporate strategy to gain a competitive advantage.
This essay will utilise the following structure. It will commence by providing the reader with a brief history about Microsoft and then go onto explaining what corporate strategy is. Following this will be Microsoft’s diversification strategy in parallel with the reasons why they choose to diversify. Within this section the author plans to explore Microsoft’s related diversification approach, their corporate rationale, alongside why skill transferring is essential to them sustaining a competitive advantage and also how they achieved and utilized economies of scope (EOS). In the section regarding reasons why Microsoft chooses to diversify will be notions of proactive and defensive reasons, along with the idea of increasing market power and spreading risk. Then finally, a conclusion will follow summing up Microsoft’s overall ability to sustain a competitive advantage.
About Microsoft
Microsoft was originally created in 1975 by Bill Gates and Paul Allen. They first introduced their software package, Window 1.0 in 1983, the first package to consist of a mouse which helps navigate a PC. MS-DOS commands were previously used to operate computer systems, however people found these extremely hard to understand. This Windows 1.0 package was a key turning point in Microsoft emergence. As time progressed Microsoft created updated versions which consisted of advanced graphics, built-in internet support, dial-up networking and much more (Microsoft, 2011). Windows packages started from Window 1.0 to the current version whic...
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...ation moves by service firms seeking benefits from information asymmetry and economies of scope”. Stratgic Management Journal, 14: Pgs 569-591.
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-Rumelt, R. P. 1974 , “Strategy, structure, and economic performance”. Boston: Division of Research, Graduate School of Business Administration, Harvard University.
-Rumelt, R. P. “Diversity and profitability”, Managerial Studies Center, Graduate School of Management, University
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- Volberda, H. Morgan, R. Et al. 2011, “Strategic Management: Competitiveness and Globalization”, Cengage Learning EMEA ,Pg 244-258
-X-box, 2011, “X-Box” http://www.xbox.com (accessed 02/11/11)
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While the Microsoft Empire maintains its status as a vast company of large-scale production, readily contributing to the national GDP, and yielding high interest and profits to its associates, criticism and controversial accusations keep mounting. The thought of a monopoly as the economic device for good business seems almost mind-boggling to Microsoft’s competing corporations, as well as the entire economic community, legal and commercial.
Arthur, A., Thompson, Margaret, A., Peteraf, John, E. Gamble, A., J., Strickland III. (2014). Crafting & Executing Strategy: The Quest for Competitive Advantage 19e: Concepts & Cases. C6-C25.
...ative aspects of diversification, for example through better corporate planning, human recourse management and reaching further synergies between its various business lines.
Porter, M. E. (2008). The five competitive forces that shape strategy. Harvard business review, 86(1), 25-40.
This video provides an overview of product diversification. It explains that there are two types of diversification, which are related diversification and unrelated diversification. In addition, the video informs that diversification often involves merger and acquisition activities. Furthermore, it stresses the importance of keeping diversifications balanced, as in some instances, companies that do not take advantage of diversification, can miss out on some benefits, and/or could experience negative effects. However, on the other hand, the opposite could also occur, because some companies that over-diversify, extend themselves too far and can experience detrimental and disadvantageous effects as well. The key is staying
Ensign PC 2004, ‘A resource based view of interrelationships among organizational groups in the diversified firms’, Strategic Change, Vol. 13. pp. 125-137.
1. Hitt, Ireland and Hoskisson (2005), Strategic Management : Competitiveness and Globalisation, 6th Edition, Thompson & South-Western.
Porter, M. E. (2008). The five competitive forces that shape strategy. Harvard business review, 25-40.
Relate Microsoft’s problems with its control and evaluation systems to each of the stages of growth in Greiner’s model.
Microsoft’s mission of placing a “PC running Microsoft software on every desk and in every home” drove their overall strategy early on. Depending on the business segment within Microsoft, one would see in place very different business models as the strategy for each line of business could vary. In the operating system (OS) segment, Microsoft initially brought in an existing product and modified this (MS-DOS) to work with the Intel microprocessor, which were the “brains” of the IBM PC. Microsoft partnered with IBM to provide the operating system for the IBM PC. In addition to developing Windows, Microsoft during this period was working to write applications for the Apple OS.
Microsoft is the leading and the largest Software Company in the world. Found by William Gates and Paul Allen in 1975 Microsoft has grown and become a multibillion company in only ten years. It all started with a great vision – “a computer on every desk and every home” - that seemed almost impossible at the time. Now Microsoft has over 44,000 employees in 60 countries, net income of $3.45 billion and revenue of 11.36 billion. Company dramatic growth and success was driven by development and marketing of operational systems and personal productivity applications software.
Porter, M. E., 1999. The Five Forces that Shape Competitive Strategy. Harvard business review, p. 80.
Microsoft is one of the leading software companies in the world and it controls substantial shares of computer operating systems. A part from operating systems, Microsoft supplies the world with other products, such as the video game console Xbox, Office Software, digital music players, server storage software, CRM applications, and Zune. In the modern world, Microsoft has embraced the idea of globalization while it has exploited current technology to increase its global competitiveness. Therefore, this paper examines how globalization and technology have influenced Microsoft Company. Moreover, the paper applies industrial organization model and resource based model to assess if Microsoft could earn high returns. Finally, the paper does an assessment of the vision and mission statements and concludes how the stakeholders influence the success of Microsoft.
Lui, C (2007), explained that lenovo realized that they were lacking several factors for going global, including a brand name with worldwide recognition, a strong presence in the world market, and the human talent to run and manage the global company. Hence, the M&A route taken by Lenovo has benefitted in three ways
Strategic renewal is another desired outcome of corporate entrepreneurship. The new economic order and business environment has created a pace of change which requires businesses to adapt more frequently and rapidly than ever before. The changes could involve corporate structure, mergers and acquisitions, addressing new market opportunities, changing product portfolios, repositioning, adapting infrastructure, or adopting new technology. Managers in an organization must be able to take stock of its situation under changing market conditions and agree on a coherent new strategy that will meet the challenges of the present as well as of the future.