Microsoft, Using The First Three SWOT

Length: 10 pages Sources: 5 Subject: Business Type: SWOT Paper: #52108950 Related Topics: Microsoft Windows, Bill Gates, Xbox, Antitrust Practices
Excerpt from SWOT :

S. $1 billion dollars operating with around 1200 suppliers that are hugely diversity. The number has seen a more than 200% increase in the last few years. The company also creates linkages with organization that are related to promoting diversity so that technological innovation can be fostered within the organization and the increasingly diverse communities can be catered to. The company endeavors to sustain relationships and linkages with institutions through employee membership and volunteerism, career events, conference interaction, software donations, and sponsorships (Microsoft, 2010).

Corporate hierarchy

The founder and chairman of Microsoft, Bill Gates is reported to have encouraged keeping a flat organizational structure so that all ideas, problems and discussions can be carried out easily. He reportedly values such organizational types because they assist in developing a flexible and dynamic organization that possesses little inertia to change, promotes an exemplary environment and motivates employees (Gates, 2010).

A main element that offers success to any business growth and evolution idea in modern times that are continually changing due to increasing emphasize on innovation and knowledge base is to let centralization go from the organization. Decentralization is the answer to new issues that are occurring because of the ever changing and increasingly competitive business environment. If the end users' that is the consumers' needs have to be met, the distance between the organization's decision makers and the consumers have to be reduced. When the organizational structure is flat, the company finds it easier to gauge the changes in the consumer demands and to respond accordingly without setting aside a lot of time to the activity. In this way, decision making can be made quickly, entrepreneurial creativity of employees is given a free reign and emphasize is laid on new ideas instead of compliance with inflexible rules and policies (Gates, 2010).

As has been stated before, Microsoft as a company is devoted to the aim of assisting their customers in reaching their full potential. Just like the company aims to continually bring innovation and experimentation in their products, they also want to encourage continuous growth when it comes to improving and enhancing technological solutions for the welfare of their consumers (Gates, 2010).

Corporate Governance at Microsoft

At the Annual General Meeting, the Board is voted for and elected by the shareholders so that the management and operations of the company can be overseen and direction and to reasonably assure the shareholders that their interests will be protected and taken care of. The Board provides oversight, review and guidance and in this way endeavors to develop and foster the company's business goals and aims. The Board of directors is responsible for supervising Microsoft's business operations and integrity, of interacting and working with the management to identify Microsoft's goal and course of action, of carrying out the annual CEO appraisal, of monitoring CEO succession development and of developing internal checks and balances for accurate and precise financial reporting (Microsoft, 2010).

The board is also responsible for monitoring the risk management function of the company while the audit committee appraises and gauges the company's ability and effectiveness of managing and reporting risk. The committee also identifies the company's policies on risk assessments and the steps that the management routinely takes in order to manage significant risks. The finance committee takes care of investment, tax, foreign exchange and other financial risk while the compensation committee manages risks that relate to remuneration policies and procedures. There is an antitrust compliance committee that manages the risks related to competition law. All these committee report to the Board and the board's responsibility is to ensure that interests of the shareholders are protected by managing the...

...

The first division is the Windows and Windows Live Division that revolves around the relationships with PC manufacturers and includes the Windows product line. The second in line is the Server and Tools that include software products and services such Microsoft SQL Server, Visual Studio, Silverlight etc. The third division is the online services division that contains an online advertising platform with provisions for publishers and advertisers. Products such as Bing and various MSN channels are the most notable efforts of Microsoft. The fourth is the Microsoft business division that consists of the Ms Office suites, Microsoft Dynamics etc. Lastly, there is the Entertainment and Devices Division that includes the Xbox video game, Windows Automotive and etc. (Microsoft, 2010).

SWOT Analysis

Strengths:

One of the glaring strengths of the company is that it is an influential and recognized brand name. Since a long time, it has been the market leader in providing software solutions, especially because of Windows and Microsoft Office that have become a household name around the world. Secondly, it carries a diversified product portfolio in that it has ventured recently into manufacturing smart phones as well. Thirdly, with revenue that almost amounts to $60 billion the company is listed under the Fortune top 50 for the year 2010.

Despite overwhelming attention being given to Microsoft's competitor Apple Inc., the revenues and profits of Microsoft continue to stand at a steady rate. Also, it is a company that has made decentralization possible despite its large structure. It operates through regional subsidiaries thereby facilitating its earlier stated goal of promoting diversified workforce and customer base. The company has its roots in over 60 countries and also provides services online through MSN (www.msn.com).

Innovation is another strength that the company possesses and the flat organizational structure of the company facilitates effective experimentation. The corporate culture of the organization promotes diversity that in turn increases the motivation level of employees who belong to varied cultural backgrounds. There is also an entertainment focus on their product line. Their software is easy to use and is thus widely appreciated and popular. The market share of the Windows operating system continues to be more than eighty five percent.

Weaknesses:

Microsoft relies heavily on hardware manufacturers to install the MS operating system in the PC. The increasing popularity of Apple has seen a recent decline in the level of sales of the OS and other server software. The company is still struggling to make a name in the smart phone and the wireless market. When it comes to the five layer management, their organization structure may not be the most effective structure there is.

One also notices their lack of farsightedness by failing to take into account the cloud computing that has offered companies like Google much success. The recent economic backlash has also seen employees of Microsoft being laid off from their jobs.

Opportunities:

Microsoft has an opportunity in the form of an untapped internet and mobile-application market that still has a lot of room for new entrants. There is also a growing demand for Personal Computers. Moreover, the devising of Internet applications on mobile phones will be cheaper for the company.

Threats:

Apple as a company is proving to be a great competitor and threat to Microsoft. Apple, with its amazing focus on innovation and bringing products, has an elitism factor attached. Also their popularity in the mp3 player and the smart phone area is also giving them attention on their hardware and operating system as well which can be a great threat to Microsoft.

Linux can also be a threat to the market leading position of Microsoft. Companies like Sun, IBM, Apple and Oracle have preinstalled applications on their hardware which may make Microsoft's stance on the market unstable. The upcoming cell phones, smart phones and other hand held devises do not require windows OS. Some of these devices such as the iPad are replacing personal computers. Piracy and shorter product life cycles are other factors that can be a threat to Microsoft.

References

Gates, B. (2010).Innovation Management Policies for Large Corporations. Taken from: http://www.1000advices.com/guru/innovation_organization_large_gates.html

Microsoft. (2010). About Microsoft: Taken from: http://www.microsoft.com/about/en/us/default.aspx

Microsoft. (2010). Diversity and Inclusion: Taken from:

http://www.microsoft.com/about/diversity/en/us/default.aspx

Microsoft. (2010). Corporate Governance: Taken from: http://www.microsoft.com/investor/CorporateGovernance/Overview/default.aspx

Microsoft. (2010). Products and Services: Taken from:

http://www.microsoft.com/about/companyinformation/ourbusinesses/en/us/business.aspx

Sources Used in Documents:

References

Gates, B. (2010).Innovation Management Policies for Large Corporations. Taken from: http://www.1000advices.com/guru/innovation_organization_large_gates.html

Microsoft. (2010). About Microsoft: Taken from: http://www.microsoft.com/about/en/us/default.aspx

Microsoft. (2010). Diversity and Inclusion: Taken from:

http://www.microsoft.com/about/diversity/en/us/default.aspx


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