Intrapreneurship-MBA

BUSINESS ENVIRONMENT ANALYSIS

Student’s Name

University Affiliation

BRIEF DESCRIPTION OF THE ORGANIZATION

The organization to be looked at in this case is Microsoft. This is a multinational technology company whose headquarter is in Redmond, Washington. The company engages in a variety of businesses but basically develops and manufactures software, consumer electronics and personal computer. Microsoft is the developer of the widely used operating system, Windows, which has gone through upgrades until the most recent one Windows 10. The company also manufactures mobile phones which run on the Windows Phone platform. Despite the challenging and stiffly competitive business environment, the company has managed to stay ahead of competitors such as Apple and Samsung through its effective business strategies that have enabled it to achieve its goals and objectives.

FACTORS IMPACTING PERFORMANCE OF THE ORGANIZATION

The business environment in which Microsoft operates is very competitive because of the factors that affect performance. It is the responsibility of the management team to make sure they apply the best strategies for the interest of the organization (Lynn & Close, 2011). The following are the factors:

i. Cost of production

The organization is the development and manufacturing industry which implies that it incurs costs in order to manufacture its products. The cost of production is an economic factor that has significant impact on business, therefore, it has to be handled in the best manner so that the performance level of the organization is maintained. If the cost of production is high, the business will experience lower profits because more funds will be spent on the production process.

ii. Prevailing market conditions

The conditions in which an organization operates have significant impact on its performance. For instance, a business environment that is very competitive will have negative effects to organizations that do not utilize the best strategies. This is an economic factor that needs to be addressed for the interest of an organization to maintain its competitive performance in the market. Microsoft is affected by the prevailing market conditions in the sense that it has to apply situational strategies. These are strategies which are periodically adjusted to meet the demands in the market. Such an approach is used because there is no single strategy that can be applied in the ever changing business environment.

iii. Corporate social responsibility

This is a social factor which also affects the performance of an organization in a given environment. Basically, CSR is about an organization realizing that it operates in an environment and a society (Hill & Gareth, 2012). Its strategies need to be beneficial to local society as well as the environment. An organization which is socially responsible usually portrays a positive public image as well as high rating by consumers; it performs better in the market.

Most critical factors

The two most critical factors that should attract the attention of the organization are the production costs and corporate social responsibility. These factors are very important because they have direct effect on the ability of a business to make profits as well as attract and retain employees and customers.

BUSINESS ACTIONS TO OVERCOME THE FACTORS

i. Cost cutting

Cost cutting is the best business action that can be applied by an organization to deal with the high cost of production. An organization such as Microsoft can cut costs by getting high quality raw materials at low prices. This can also be achieved through improvement of different processes so that the cost of running them is reduced. The company can also consider only employing workers that are really necessary for the interest of cutting down costs spent on salaries and allowances.

ii. Market analysis

This is a business action that can assist organization to understand prevailing market conditions so that the most effective decisions are made (Lynn & Close, 2011). Microsoft needs to analyze the market deeply so as to understand various factors that contribute to the situation. Through this, the company can understand how stiff the competition is as well as the specific strategies applied by the competitors. In addition to this, the business will also be able to understand consumer behavior and this will make it possible to come up with products that meet consumers’ needs.

iii. Embracing corporate social responsibility

To overcome the challenge of corporate social responsibility, the organization needs to give the locals the first priority in terms of employment (Hill & Gareth, 2012). Additionally, its processes need to be improved so that they are environmentally friendly.

References

Hill, C. & Gareth, R. (2012). Strategic Management Theory: An Integrated Approach. London: Cengage Learning.

Lynn, R. & Close, G. (2011). Consumer behavior knowledge. New York: Routledge