BA Capstone

BA CAPSTONE

Assignment 2

Microsoft

BA CAPSTONE

Introduction

Microsoft Corporation is a global technology company that develops various software products and licenses (Bhanji, 2012). This paper aims at underpinning the general environment of the Microsoft Corporation in terms of its segments. Further, the paper will examine the five forces of competition. Also, the essay will analyze Microsoft's future environment, external threats and opportunities, strengths and weaknesses, resources, competitions, and core capabilities. Furthermore, strategies will further be examined in this discussion concerning Microsoft Corporation.

General Environment

The political segment

In this segment, the government plays a role in shaping the business. Hence, the political segments include aspects such as tax policies, tariffs, trade restrictions, and government stability (Enland, 2013). Therefore, the political segment plays a vital role in determining factors that can affect Microsoft Corporation concerning its long-term profitability in the specific market. Studies show that Microsoft Corporation operates in business software and services around the globe. Thus, Microsoft Corporation is exposed to diverse political environments and political risks. Hence to achieve success in the software and service industry, the corporation needs to diversify the systematic risks concerning the political environment. Therefore, before entering any market, Microsoft Corporation should analyze these factors;

· The level of corruption in a specific country.

· The significance of Business Software and Services in the specific country's economy

· Risks concerning the military invasion

Economic segment

Studies indicate that an economic segment deals with the economic conditions in which the Microsoft Corporation operates (Enland, 2013). In this segment, various elements such as inflation rates, unemployment rates, interest rates, and the general growth determine the investment and demand in an economy. Therefore, Microsoft Corporation can utilize the country's economic factors such as inflations, economic indicators, and growth rates to predict the overall growth of the organization. Hence, about industrial segmentation, Microsoft should take into consideration that following factors;

· The stability and type of economic system in different countries

· The efficiency of the financial markets in local markets

· The economic productivity and labor costs

· The economic growth rate.

Five Forces of Competition

Microsoft Corporation significantly addresses the issues underscored in the Five Forces Analysis. The critical role of the Five Forces Analysis is to get an understanding of the external factors that affect Microsoft Corporation (Grant, 2015). Hence, this discussion will examine the two major Five Forces of competition in Microsoft Corporation.

Rivalry among the existing firms.

Competition is the most significant aspect when it comes to Microsoft Corporation. To remain unbeaten in the market, Microsoft Corporation should be very competitive. Competition determines who different firms affect one another and the related industry environment. Thus when it comes to Microsoft Corporation, various factors create a strong competitive force against the organization. Reports show that moderate switching costs have a significant influence on Microsoft's overall business. For instance, the tendency of Microsoft's customers to shift to different firm's products is moderate. High aggressiveness of firms is another strong force the company's industry involvement Microsoft should be very aggressive in terms of the marketing and innovation campaigns. Hence, Microsoft should create a potent force depending on the high diversity of companies.

Microsoft's customers' bargaining power

Customers are the main determinants of organization performance; hence, Microsoft Corporation should work to satisfy all its customers. The five forces competition explains the influence that the supplies have on the computer software and hardware in the Microsoft industry environment. Various factors contribute to weak force concerning the bargaining power of the Microsoft Corporation supplies. The moderate size of Microsoft supplies contributes to the significant but limited impact on the Microsoft business. For example, certain moderate supplies of various computer hardware can change the prices hence making Microsoft adjust their prices.

Evaluation.

Microsoft Corporation has addressed the two major forces of competition in various ways. Research shows that Microsoft faces rivalry from its core competitors such as Apple. However, Microsoft remains dominant in the market besides the higher competition. Microsoft's high-quality products and good services have made it remain dominant in the market throughout the globe. Furthermore, Microsoft Corporation has been experiencing more consumers' bargaining power. The bargaining power has been high since most companies offering the same products and services as Microsoft provides them with better options (Grant, 2015). Howe rover, most customers, prefers operating system from Microsoft due to quality and efficiency.  

Future environment

The issues of customers' bargaining power and rivalry from other similar organizations have a significant impact on the future of Microsoft. Thus, such issues should be addressed to make more improvements in the future. Microsoft should provide more unique services and products which would reduce the bargaining power of customers. On the other hand, rivalry with other firms is a critical aspect. Hence, Microsoft should dig more markets and reduce slightly reduce the price of their product and services to curb competition with other similar corporations.

External Threats and opportunities

Threats

· Threats of new entrants. Microsoft Corporation always faces threats from other corporation who tries to enter into its operating system business. Hence, new entrants are a threat to Microsoft.

· The threat of substitutes. Microsoft has been facing threats from substitute products such as Linux, which can be used in place of windows operating system (Helms & Nixon, 2010).

· Competition. Microsoft Corporation has been facing competition from other industries such as Apple. Thus, competitors are a threat to the company.

Opportunities

Microsoft Corporation has been capable of developing IT infrastructure across the globe. Thus, such expansions have given Microsoft high chances of growth and development. Microsoft has further attained the following opportunities in its technology business:

· The innovation of diverse computer hardware products

· Business diversification

· Good security against cyberattacks

Threats and opportunities strategies

Microsoft Corporation has a more significant capability to remain dominant in the computer software and hardware industry. Thus, to advance its opportunities, Microsoft should create a strong brand image. Besides, Microsoft should enhance its alliance with different firms to improve its positive externalities. Threats negatively impact an organization. Hence, Microsoft should diversify its business to strengthen growth and reduce the entrants of new firms.

Strengths and Weaknesses

Microsoft Corporation Strengths

Microsoft corporation is one of the most robust computer hardware markets across the globe. Hence, the corporation has a high capability of attracting many customers, thus increasing their customer base. Besides, Microsoft gains more benefits from a myriad of positive externalities with its existing products. For instance, the windows operating system is prevalent in the market. Besides, Microsoft company has a higher capacity to affect the market in its favor. For example, Microsoft integrates with hardware manufacturers to make products that can use their windows operating system (Helms & Nixon, 2010).

Weaknesses of Microsoft Corporation's

According to the reports, Microsoft experiences the following weaknesses:

· Microsoft is more vulnerable to cybercrimes

· Imitability of certain products

· Microsoft Corporation lacks a dominant computer hardware

Strategy

Therefore, to improve the strengths and eliminate the weaknesses, Microsoft should come with different strategies. For example, Microsoft should build good relationships and stronger alliances with various firms such the hardware firms. Besides, the corporation should strengthen its key positive externalities to facilitate more growth.

Resources, Capabilities, and Core Competencies

Resources

· Human resources. Microsoft has a well-trained and capable human resource that enables the organization to attain the set goals and objectives.

· Computer and software. Products. Microsoft provides computer and software resources, which are the primary brand of the corporation. The software includes the Windows operating system, and the hardware includes desktop computers, laptops, tablets, etc.

Capabilities

· Useful software functionality for different applications. Microsoft provides different software which supports various applications.

· Alliance with different manufacturers. Microsoft partners with various manufacturers to make that they provide hardware compatible with their software.

· Strong brand image. Microsoft Corporation has a robust brand image across the globe, which facilitates its growth.

Core Competencies

Microsoft identifies its primary core competencies, which assist them in gaining high revenue. Microsoft's core competencies lie in the windows operating system. Hence, they access broad markets, thus making a significant contribution to different customers (Agha, Alrubainee & Jamhour, 2012). Besides, its core competency helps the corporation to remain very competitive in the market. Microsoft also uses the new technology to improve their core competencies thus maintain high quality in hardware and software delivery

References

Agha, S., Alrubaiee, L., & Jamhour, M. (2012). Effect of core competence on competitive advantage and organizational performance. International Journal of Business and management, 7(1), 192.

Bhanji, Z. (2012). Transnational private authority in education policy in Jordan and South Africa: The case of Microsoft Corporation. Comparative Education Review, 56(2), 300-319.

England, P. (2013). U.S. Patent No. 8,352,740. Washington, DC: U.S. Patent and Trademark Office.

Grant, R. M. (2015). Five Forces of Competition. Wiley Encyclopedia of Management, 1-4.

Helms, M. M., & Nixon, J. (2010). Exploring SWOT analysis–where are we now? A review of academic research from the last decade. Journal of strategy and management, 3(3), 215-251.