Introduction
Microsoft Corporation is tied to some of the world-historic processes like the technology revolution and the second industrial revolution. The company’s main products are Windows and Office software. The change in central leadership in the management department brought a change in the company’s policy. The partnership-centered approach has taken the place of high-octane leadership. This strategy helped the company to focus on innovation and business growth. This SWOT Analysis reveals the strengths and weaknesses, which are internal dynamics in the working of the company. Furthermore, this analysis exposes external business drivers, which are opportunities and threats prevalent in the market. These factors signify elements of distinctive product innovation, cyber security, and business diversification. These approaches are necessary for the company to adopt because they can increase the company’s long-term engagement in the market and growth of the business.
Strengths of Microsoft
The company’s reputation and identification create a big market difference. The names of the organization and its founder are known to people living in any region of the world. ‘Microsoft Corporation’ and ‘Bill Gates’ are well known to all computer literates in the world. It gives the company an upper hand over its rivals. The company’s shared market and customer audience are diversified throughout the globe. Another core strength of the organization is the manufacture of easy-to-use products. This policy has played a key role in expanding the company’s legacy worldwide. The large-scale accessibility and usage of the company’s products have shaped “second industrial revolution,” where access to a computer and related software was provided around the globe. Consequently, Microsoft has become a leading organization to provide OS and software and captured 90% market of OS around the globe. The company’s brand reputation has been classified in the top names for many years. Interbrand has ranked Microsoft as the 5th most valuable brand in the world. These factors lead to better market share and business growth.
The organization has an effective network of supply chains globally which enhances effectiveness and performance. Partnership-centered leadership has benefited the company in making cooperation agreements with other companies. It is co-branding with many hardware makers of computers to escalate business. Lenovo, Dell, Toshiba, and Samsung are computer hardware stores with Microsoft OS already installed on them. This strategic depth has given positive results. The company’s product users have increased incredibly. It was expected that increased use of mobile technology could limit the use of computer systems. But this is far from reality. The company has earned significant revenues in the last few years. Microsoft had given robust financial performance indicators when its revenues grew 20% in the period of 2008 to 2012. It held more than $63 billion cash equivalents which can be utilized for research and development. One more strength of the company is the acquisition of skype. With over 300 million users, the company has the edge of generating more revenue through advertisement.
Weaknesses of Microsoft
The unforgivable mistake by Microsoft was the ignorance of the potential of the internet phenomenon. In a short span of time, internet businesses flourished and spread across the world. Microsoft didn’t respond effectively to the new normal. In fact, the internet thing remained on the backburner in the policy. In the case of mobile technology and computing, Microsoft treated it the same way as it treated the internet. This revolutionary race was missed by Microsoft, which waved its rivals to play broadly. Apple and its founder bashed on Microsoft that it has failed to keep pace with the time and that the company has failed to produce any significant mobile device or their operating systems.
The mature market of computers makes it harder for the OS and laptops to generate huge sums of profits. Microsoft, to add more, has failed to address the repeatedly prevalent security issues and flawed products. These security flaws in software or operating systems are encountered in any version. It is also widely believed that Microsoft is very prone to virus attacks. A company with such massive resources can lead innovation and can bring new products to the market. Unluckily, Microsoft has consistently failed in innovating new technologies. Its products like Massive, LinkExchange, WebTV, and Danger are a few examples of flop products.
Opportunities for Microsoft
The company is making its way to capture its position as a global leader. Cloud computing and cloud-based services are being explored by the company. The company can reclaim its customer base through services. The newly appointed CEO of Microsoft showed deep interest in cloud-based services. Satya Nadella, an Indian and a cloud-computing expert, has aggressively pushed the company towards cloud services.
From a business perspective, the company is able to grow inorganically or passively. If the organization is restrictive in normal growth, it can still grow through acquisitions. The company’s massive revenue accumulated over the years can acquire as many businesses as it desires. In this way, when Bill Gates missed an opportunity to keep pace with internet business, he purchased Hotmail from an Indian named Sameer Bhatia. It generated a lot of revenue until google introduced email services.
Threats to Microsoft
Microsoft Corporation’s vast size and diversity have made it sluggish and slow to capture the market. The pressure on Microsoft is more than ever to launch products to counter the influence of Apple and Google in the market. It must proactively grab market opportunities by discerning market signals. Further, a key challenge is the availability of Open-Source software. Free software is a potential threat to Microsoft’s expensive products.
The threat of software piracy has significantly damaged the company’s profits. In Asia, for instance, reports revealed that pirated versions are more in number than the original versions of Microsoft in India and China. Lastly, Microsoft has faced many lawsuits against its monopolistic business practices. Regulators had inflicted heavy fines when the company lost some big lawsuits. Moreover, these lawsuits are expensive and time-consuming to follow. If Microsoft does not change its malicious business practices, more lawsuits are on the way.
Conclusion
The above conducted SWOT Analysis has enlightened strengths, weaknesses, opportunities, and threats to Microsoft Corporation. It clearly stated that Microsoft must not ignore the modernizing aspect of the world. Innovation and experimentation keep the dynamic corporate practices that are necessary to explore nosiness opportunities. The company must retain a position where it can sense and react to market developing customs. Another great opportunity for Microsoft Corporation lies in the enterprise segment. The company’s vast share of resources and network can give a clear edge to this end. The pursuit of Cloud-based services can prove to be an effective strategy. In conclusion, it is to be seen in the near future how company perceived and reacted to the growing innovation and technological changes in the computing, software, and related fields; it can retain its legacy, and global leadership position by envisioning futuristic strategic planning taking considerations of the given do’s and don’ts.
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