CASE 13 TWITTER 1
Case Study 1
Alexander Kennedy
BUSI 690
11/29/2020
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CASE 13 TWITTER
Table of Contents
Introduction ........................................................................................................................................... 3
Objectives and resources ....................................................................................................................... 4
Mission statement .................................................................................................................................. 5
Products and services ............................................................................................................................ 6
Markets .................................................................................................................................................. 6
Technology ............................................................................................................................................. 7
Financial soundness ............................................................................................................................... 7
Existing model ....................................................................................................................................... 8
Historical financial statement ............................................................................................................. 13
Ratios ................................................................................................................................................... 13
Alternative strategies ........................................................................................................................... 14
Pro-forma statements .......................................................................................................................... 14
EPS/EBIT analysis .............................................................................................................................. 15
Recommendation for long term .......................................................................................................... 15
New business model ............................................................................................................................. 17
References ............................................................................................................................................ 18
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CASE 13 TWITTER
Introduction
In most cases, an organization's success depends on the assessment that the managerial
team completes making it easy for them to learn about the practices that are needed to facilitate
the necessary change (Stouten, Rousseau & De Cremer, 2018). After understanding the problems
in an organization, the managerial team comes up with the acceptable practices that may make it
easy for the effective management of the issues that make it challenging for the attainment of
goals. One of the organizations that have succeeded over the past years in developing the most
influential communication platform that makes the community feel engaged is Twitter. This
organization is among the organizations with a broad customer base, serving customers from
different parts across the globe. In addition to applying the right means of communication,
Twitter has succeeded in applying the right way that the customers can offer feedback in the
areas that they believe that the management should improve. The organization puts in place the
measures needed to assist in the improvement of the rate of provision of the right services
required to improve the rate of communication among the members of the community that the
organization serves.
The primary change that the managerial team in this company has put in place is that it
helped it in the practical realization of the various goals that the organization attained, including
the provision of the services that the community requires to facilitate the development needed.
Over the past years, due to the development and improved performance that this organization
had in the local areas, the management put in place the considerations that have made it easy for
the firm to make it to the global platform. Most of the projects that the organization has engaged
in over the recent past indicate the goals that it has in the practical realization of the local and
global level success (Dong & Rim, 2019).
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Objectives and resources
Having the right resources in an organization plays an essential role in realizing most
goals in an organization. In this firm, the managerial team's main effort over the past years has
made it relatively easy to improve their business through partnerships, among other strategies
(Dong & Rim, 2019). As a result of this, this organization's position as the global market leader
has improved, thus making it relatively easy for this company to attain more of the goals that it
has through improved reputation and revenue. The integration of the right technology is the most
important practice that has helped the organization effectively realize the development of the
needed products and ensure that the customers it serves from different areas across the globe are
well served. The level of competition experienced in the telecommunication sector is relatively
high (Dong & Rim, 2019).
As a result of the high level of competition experienced in most of the areas that the
companies that offer these services serve, it requires the development of the most effective
practice that may result in the effective attainment of most of the goals. With the right supply
chain integration in the organization, the management succeeds in effectively managing the plans
that exist in its operation. At the same time, facilitate the organization's overall expansion to
cover a relatively large area that may make it easy for the company to improve the overall
functionality in the aim of the organization to cover an extended area in the provision of the
proper communication and interaction services to the general community. The management has
been able to learn about the right services that the community may need and the most appropriate
practice that is required to facilitate the integration of the right resources that may help realize
most of the global goals.
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CASE 13 TWITTER
Regarding the organization's intention to attain an international transition, the
management needs to evaluate the organization's historical data records to give the organization
insight into some of the practices it engaged in over the past years that made it easy for the
practical realization of the organizational goals. This assessment is helpful since it gives the
management insight into the changes that have occurred over the organization's past years. That
could have contributed towards some of the necessary changes to make it easy for the successful
expansion to a global level.
Mission statement
For the company to ensure that most of the goals are effectively accomplished,
integrating the practices that show that the company is willing to consider and address the
problems that the community experiences help reduce the issues that it may encounter. The
company's success depends on the consideration of the issues that the community encounters to
assist in the development of the right measures that may bring about the needed changes. The
mission of Twitter is to provide the consumers with a platform for creating as well as sharing
information without limitations or barriers.
New Mission Statement
The new mission statement should be concerned with the improvement of the freedom
which the consumers exhibit in the creation and sharing of ideas while at the same time
generating wisdom instantly. This mission can be viewed from various dimensions as discussed.
The customers are the primary consideration that this organization focuses on and aims at
ensuring that they are well helped. Initially, most people believed that the group that is fit to be
the customers of the organization are the people who fall in the Middle Ages and the celebrities.
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CASE 13 TWITTER
However, after the development of this organization, they were able to make it in an approach
that assists in ensuring that most of the needs of different people from the various areas from the
globe are well addressed. The application of the right technology is one of the issues that assist in
increasing the number of people who find Twitter as the most appropriate social network plays
an essential role in facilitating the improved success of this organization in arriving at most of its
goals. The customers of this organization further entail the influential organizations that rely on
this social platform to send a message to its customers regarding the operations of this
organization. Since Twitter offers advertising services to its customers at an affordable rate, it
has ensured that most people can learn about the operations of the organizations and the different
products they offer to the community.
Products and services
Twitter offers different products to people from different areas globally (Alkhammash et
al., 2019). Since it is a global company, the integration of different languages is one of the
practices that makes it easy for people from different areas to learn about the effective use of
services. Among the offered services are; communication practices, learning services and
affordable advertising that the community may rely on when advertising different products that
they provide to the general community (Cherney, 2020). In addition to this, this organization's
products assist it in covering a relatively large area when solving most of the community's needs.
Markets
With the right market of most of the products that the organization offers, it has been able
to reduce most of the problems that it faces and at the same time ensure that there is an overall;
improvement of the market cover. This company has it's market worldwide where the primary
intention is to ensure that a reasonable number of people worldwide are well connected.
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Technology
With the right technology that Twitter puts in place, it has been able to reduce the
chances of failure and at the same time, increase the quality of services that are offered to the
community. As a result of the increased number of customers served by this organization, the
management ensures that the applied technology is the most appropriate that may assist in
ensuring that the goals are well addressed.
Financial soundness
The main concern that the management has in mind when engaging in most of the
practices that it undertakes is to ensure that it increases the level of financial stability. As a result
of the problems that may exist due to financial constraints, the practices that are undertaken by
the management shows its readiness to ensure that the related economic issues are well
addressed.
For the ethical practices that are meant to assist in attaining most of the goals of this
organization, the consideration of the problems encountered in the area and some of the practices
that may require additional efforts. The organization's beliefs are necessary for making it easy to
reduce most of the barriers that may hinder the organization's effective operations. The
competitive advantage that Twitter has in this area is that it can provide the community with the
right products and services that involve the improvement of the level of competency and the
creation of the right image in the overall sector (Dong & Rim, 2019). As a result of the provision
of most of the practices that the organization offers, it has been able to ensure that the issues
involving social and environmental areas that it operates are well addressed, an issue that
contributes towards the effectiveness of the measures that may define its overall success. The
employees that work in this organization are the ones who have played an essential role in
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CASE 13 TWITTER
bringing about its success. For that reason, it is worth noting that the management ensures that
they are offered with the right treatment and perceived as critical assets that may facilitate the
level of success in the organization. The employees in this organization are given a chance to
make suggestions that are needed to facilitate the necessary changes and ensure that the
organization can realize most of its objectives.
Existing model
The existing model in an organization plays an essential role in facilitating the needed
changes and at the same time making it easy for the practical realization of the gaps that are
experienced in the sector that this company serves. For Twitter, having the right business model
has made it relatively easy for the practical realization of the goals that are meant to facilitate the
growth of the organization at the global level. Like the other social networks that are known to
offer the related communication services to the community, Twitter engages in the application of
licensing that is meant to make it easy for the organization to attain the needed financial
resources. Data licensing as well as other practices that twitter engages in are well known to
make it easy for the significant increase of the level of economic stability in the organization,
thus making it relatively easy for the organization to reduce the chances of failure (Ramprabu et
al., nd). The other approach is the organization's business model because it relies on advertising
to obtain the financial support needed to make it easy for the organization to attain most of its
needs. The occurrence of the expenses that may affect the operations of the organization is well
managed through the application of the measures that ensure that the method that is used is likely
to make it easy for the organization to attain more. After learning about the needs in the market
and the challenges encountered in its operation, the management can come up with the right
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CASE 13 TWITTER
practices that may assist in the overall reduction of the possibilities of increased expenses that
may occur in the general operations of the organization.
Strengths
One of the strengths that this
organization has is that it has focused
on the high rate of innovation that
may benefit the customers and elevate
the level of customer experience.
Strong influence over Facebook
Loyal consumer base as compared to
Facebook
Strong market share as compared to
Instagram and Facebook
Popular for news and marketing due to
higher market reach
Stability in financial performance over
the years
Huge product and service portfolio
such as Magic Pony among others.
Highly innovative and fun
High recognition in the industry due to
a strong brand.
Weaknesses
Online harassment is the main
challenge that this organization
encounters.
Poor algorithm to match the needs of
the users (Esposito, 2020).
Overreliance on the US market as
opposed to global platforms and
advertisements (Cherney, 2020).
Overdependence on advertisements
earning 86.5% of its revenue.
Reduced diversification of products
and services.
We are increasing operational costs.
It increased fake accounts which is
similar to Facebook.
The organization encounters a
reasonably high cost concerning the
primary operations, thus affecting its
overall performance.
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CASE 13 TWITTER
The broad audience that this company
has is the other strength that the
organization have.
Most marketers rely on this
organization as the right platform to
assist them in marketing their different
products.
Based on the operations that this
organization engages in, the low
revenue that it records is among the
problems that it experiences that may
make it relatively hard for the
practical realization of most of the
speculated goals.
Opportunities
High chances of diversification may
have an impact on the company’s
operations.
Online store establishment
Feature enhancement
Offer remote working opportunities
Venture in the video and music
streaming business.
Invest in user satisfaction projects.
Invest in mobile advertisements to
increase revenue
As a result of the organization's
improved performance, it has been
able to target different user groups,
Threats
The company faces major regulatory
threats from the governing bodies in
the different countries that it expands
its services.
Increased competition from Facebook
and TikTok.
Limited freedom of speech for the
users.
Pressure from the investors to remove
the current management as far as the
CEO is concerned.
Easy for influencers to quit and move
masses of followers along.
Newly introduced digital taxes.
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CASE 13 TWITTER
thus making it easy for the practical
realization of most of the goals that
may assist in the effective
performance in the company (Liew &
Wang, 2016).
The increased number of
organizations that offer related
services is the other threat that this
company faces that makes it relatively
challenging to provide the most
effective services to all.
Although it is a growing company,
there is a notable reduction in the
attraction that this company gets
compared to the other organizations
that operate in the company.
The other threat that this organization
experiences that may have a notable
effect on its overall performance are
the fluctuation of currencies in the
areas that it operates
This organization's success has for a long time, depending on the approaches that the
managerial team puts in place to assist in the practical realization of most of the goals that it may
have. One of the practices that play an essential role in the improvement of the overall
performance of the organization in the provision of these services is the fact that it has a
significant number of employees who assists in the practical completion of the tasks that are
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CASE 13 TWITTER
meant to assist in the realization of most of the organizational goals. The inclusion of the right
resources in the organization is the other practice in this organization that facilitates improved
performance in this organization, thus reducing the organization's enhanced version. The
company has a rich source of investment opportunities that are needed to allow for the
generation of the finances required to make it easy for the attainment of most of the gaps that
need to be managed in this sector. In addition to this, the organization's target audience makes it
relatively easy for the company to find it easy for the realization of the speculated goals.
External factors
Although the practices that occur in the organization impact the operations of Twitter
Company, other factors are beyond the management of this organization that may further
influence the overall performance in the provision of the right services that the customers may
need (Xuan, nd). The political factors in the general community play an essential role in the
team's decision. The government may come up with new legislation that could have a negative
influence on the overall performance of the company mentioned. Social change is the other
external factor that could have a notable effect on the organization's primary operations where
the members of the community may engage in practices that may show their changes in
preference. With the high number of social networks and other communication methods, the
operations of the organization may be affected by how the organization operates. The level of
automation in the Twitter Company may also have a notable effect on the production rate in this
organization, thus influencing how it may attain most of the objectives.
Based on the information presented through the attached workbook, one of the main
conclusions which can be made about Twitter is that it stands at a better position to earn
increasing revenue as compared to rivals such as Facebook and Instagram. As the CPM matrix
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CASE 13 TWITTER
shows, the firm is better positioned to meet the clients and investors' needs based on the
performance against the rivals. For instance, Twitter scores better than Facebook and Instagram
at 2.09, 1.82 and 2.00, respectively. The BCG matrix shows that the firm's three main assets
which are operations, marketing and communication, are stars. The company's stars form a
foundation for the improvement of the firm's ability to achieve the ideal goals as far as financial
gains are concerned.
Historical financial statement
As attached to the workbook, it is essential to note that the firm has reported a significant
change in the total assets, shareholders equity, and the net revenue earned across the selected
years. The case study offered financial statements which show that the firm is committed to
achieving a better outcome in the future as far as productivity is concerned. With a rise in total
assets and shareholder's equity, the firm is better positioned to promote profitability. On the same
note, the firm reported a positive trend in the total revenue earned from 2015 to 2017. This trend
helped to create a reliable framework for improved profitability. While the firm did not report a
profit, it reduced the loss incurred across the three years.
Ratios
The firm reported a negative trend in debt to equity as well as the return on equity. High
debts and liabilities can be associated with this trend. However, with a positive value in the
current, quick, debt to assets, asset turnover, total asset turnover, the operating and gross profit
margins, the firm stands at a better position to promote better outcomes in the future. Secondly,
the firm on the projected figures is expected to earn a higher return on equity but reduce its
return on assets. Additionally, it is projected that the firm will have current and quick ratios
below 1. The firm will likely continue to take debts to support investments raising its debt to
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CASE 13 TWITTER
equity ratio. Regardless, the firm is likely to overcome the current losses but at a slowed pace
and a small growth margin.
Alternative strategies
Twitter has not had the best operating years in the past. The firm has reported poor
financial performance over the years despite being strategically positioned in the industry against
rivals such as Facebook (Esposito, 2020). The first alternative that will help Twitter turn around
and earn profits is diversifying its operations, products and services. For instance, the firm will
need to invest in other revenue streams, such as online video and music streaming services. Such
an alternative will allow the firm to target a different and wider market in the industry. This
market remains untapped with only a handful of rivals such as YouTube.
The second alternative is for the firm to increase a mobile-based advertisement approach.
This alternative focuses on the creation of a reliable approach for selling advertisements to
mobile users. Majority of the users utilize mobile devices. Using this opportunity can help the
firm to increase advertisement revenue (Cherney, 2020).
Pro-forma statements
As indicated on the attached workbook, Twitter can earn the desired goals based on an
improvement in the revenue, sales and reduction of the overall debts accumulated today.
However, the trends show that the firm will have a higher revenue for the coming three years.
While the operating expenses will increase, the trend will not adversely affect the gross profits
recorded across the years. However, increasing interest in expenses and taxation will affect the
total revenue accumulated. Regardless, it is projected that the firm will regain its profitability in
the long as opposed to short term.
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From another dimension, the firm will likely record a positive trend in assets and
liabilities. Regardless, the rise in liabilities will not affect the shareholders` equity earned in the
process. As opposed, the firm will likely record a positive trend in the accumulation of
shareholders` equity both in the short and long terms as indicated on the attached workbook on
the projected financial statements.
EPS/EBIT analysis
When considering the option of common stock financing, it is worth noting that the firm
during recession reported positive earnings per share amounting to $3.53. Under normal
conditions, the earnings per share amounted to $1.12 while in the boom, the firm recorded $4.12
in EPS. However, when considering debt financing, the firm would under recession report EPS
of $-877.30. Normally under debt financing, the firm would have an EPS of -$1191.32 while at
the boom, the EPS would be -$799.56. These figures show that the firm should consider common
stock financing regardless of the increased liabilities since it would lead to a positive EPS as
indicated on the attached workbook.
Recommendation for long term
From the analysis of the company’s past and present performance, it is important to
venture into diversification which would help the firm create a new and different revenue stream.
The firm should consider focusing more on the global platform as opposed to the United States
market alone. Increasing competition from firms such as Facebook and TikTok. For instance, the
firm should ensure that it considers the markets' needs in areas such as Japan, Europe and Africa.
Focusing on these markets will allow the firm to customize the products and services offered to
the consumers. The firm should position itself in the industry as the ideal platform for common
users and businesses that need to reach out to more consumers.
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CASE 13 TWITTER
Therefore, Twitter should focus on creating a loyalty program where the desired
consumers will subscribe at a given fee for every month. The users would be subjected to various
benefits, such as approved accounts and longer text messages. This system's creation would help
the firm increase revenue through subscriptions and selling exclusively to loyal consumers. The
implementation of this plan would be achieved in three main phases. The first phase would be
data collection and analysis.
This phase would allow Twitter to gather as much information as possible about the
existing gaps in the industry concerning its proposed solution. This phase should take about six
months to collect, analyze and project the potential occurrences which may be witnessed in the
industry. The second phase would be the creation and implementation of the proposed loyalty
program. This phase will allow the firm to develop, test and market the proposed program. The
last phase would include rolling out the proposed changes to the interest consumers.
This phase will include the full-blown implementation of the proposed system and
attracting consumers from multiple dimensions. The success of the firm will be affected by the
ability to attract more loyal consumers and influencers. The proposed solution will have multiple
benefits for the firm. For instance, the firm will be better positioned in the industry to earn more
revenue. The program's growth will have a long-term solution for the firm to continue earning
revenue regardless of the changes in the industry. However, the firm must ensure that the
proposed approach is constantly updated and upgraded to keep existing and attract more
consumers.
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New business model
Twitter will be required to adopt a new business model that will focus more on
diversification of the consumers' primary products and services. Currently, the firm uses a
common model to most of the similar entities such as Facebook where the users create an
account and post messages. This platform, in turn, creates a pool of potential leads and
consumers. Companies can use this platform to provide sponsored messages as a way of
marketing their products and services. Additionally, companies can use Twitter's data to craft a
marketing strategy that matches their consumer needs and demands in the industry. Twitter
should, however, focus on diversification of its services and products. However, advertising and
data licensing should be the main dimensions of the firm in making money. The new business
model should be comprised of three pillars. These pillars include advertising, data licensing and
premium services. The premium services would be offered to a selected group of users who will
pay per month for the services offered. The selected group of users must have a predefined
number of followers. In the process, such a business model will increase the revenue earned by
the firm.
Twitter's consumers are the entire population, the general community and business
entities. These consumers have different goals when using Twitter, such as entertainment,
marketing and news. The firm offers marketing, advertising and data licensing services to the
consumers depending on their needs. Additionally, the firm offers a platform for the users to
connect regardless of the distance and time. The firm operates globally delivering these services
to the entire population as far as it is connected to the internet. The firm continues to implement
technologies that help it perform its day-to-day tasks such as data management and algorithms
for maintaining and sustaining consumers and user interface design. While the firm is committed
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to growth, its past financial performance is poor, threatening its survival (Esposito, 2020). The
firm's basic beliefs reflect on connecting people and allowing them the ultimate freedom of
creating and sharing content without limit. The ethical priorities for the firm reflect on data
security and ensuring the privacy of users. The firm's primary competitive advantage is
witnessed on the simplistic approach to marketing through strategic data collection and sharing.
The firm maintains a connection with the community from a cultural competency dimension by
addressing issues such as morals, ethics and language alignment of the content offered. The firm
values its employees since they form a foundation for its operations and hence success.
References
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Dong, C., & Rim, H. (2019). Exploring nonprofit-business partnerships on Twitter from a
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Esposito, F. (2020). Twitter is studying new ways to increase revenue with subscription model.
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