Order from us for quality, customized work in due time of your choice.
Understanding the strategies that a company employs at the business and corporate levels is instrumental to evaluating the efficacy of its performance. More importantly, the selection of business and corporate strategies within an organizational context determines the companys viability in the target market (Hitt, 2020). By incorporating proactive and reactive approaches to its business strategy and implementing an IT strategy as a framework for the corporate one, Microsoft has managed to stay relevant in the highly malleable global IT market.
Business-Level Strategies
The development of a business-level strategy represents a pivotal point in the performance of an organization since the specified step solidifies the organizations approach to product branding and its framework for managing its available resources. In effect, a business-level strategy contributes to the creation of the competitive advantage that will allow a firm to place itself on the map of the selected economic context, therefore, predetermining its success (Hitt, 2020). At Microsoft, the focus on differentiation has been quite prominent since the emergence of the firm, suggesting that the company embrace the exceptionally high multitude of opportunities and remain a pioneer in the IT sphere.
Indeed, considering the brands that Microsoft provides, one should admit that the company has been seeking to embrace the broad range of opportunities that the IT market provides (Wang et al., 2020). Specifically, since its emergence, Microsoft has made a foray into three markets, namely, software, intelligent clouding, and personal computing (Wang et al., 2020). By maintaining relevance in each of the specified areas, Microsoft has managed to retain its undeniable competitive advantage and its leadership position. Remarkably, the company managed to do so despite the emergence of other companies and the development of a rather stiff competition (Wang et al., 2020). Therefore, the business-level strategy that Microsoft has been seeking to implement can be defined as that one of differentiation.
Indeed, applying a critical lens to the selected economic environment, one will have to admit that the focus on diversification appears to be the most sensible approach to undertake. Specifically, as Porters 5 Forces Model below illustrates, Microsoft has been operating under significant pressure on increasing rivalry in the IT market. Nonetheless, the company has been managing to retain its superiority in the IT sphere due to its vast experience, innovation, and the fact that it produces the operational system that is used nearly unanimously across the globe (Wang et al., 2020). While Apple poses a substantial threat as a competitor, Microsoft has been outstandingly successful and productive in its niche (Wang et al., 2020). Therefore, its ability to retain dominance in a context of high competitiveness allows for a diversification approach as opposed to the implementation of cost leadership. Though the extent of competition may increase in the future, Microsoft will have to consider retailing the current approach and its leadership stance since it helps the company flourish and introduce innovative solutions into the market, therefore, remaining attend-setter in the IT industry.
Corporate-Level Strategies
In turn, the corporate-level strategy that Microsoft has chosen reflects the companys intention to further diversify its products and manage an expanded range of potential market settings. Specifically, Microsoft has been seeking to maintain its competitiveness high while also sharing activities between different businesses that it controls, including the production of software, the development of intelligent clouding, and the integration of personal computing (Wang et al., 2020). Consequently, the framework that Microsoft has been adopting as its corporate-level strategy can be described as related linked diversification (Wang et al., 2020). Involving high levels of both corporate and operational relatedness, the specified approach suggests that Microsoft manages to control different businesses within different markets, at the same time successfully pioneering innovative tools and services (Wang et al., 2020). The framework in question appears to be the most sensible strategy for Microsoft presently given the increasing levels of competition within the target economic setting. Specifically, the framework in question allows Microsoft to engage in value-creating activities that lead to an increase in the extent of opportunities for the organization.
The efforts to introduce the principles of the related linked diversification approach into the corporate setting is also reflected in Microsofts approach to managing the corporate structure. Unlike the related linked diversification framework suggests, Microsoft has been avoiding to implant the concept of vertical integration into its corporate setting, preferring the horizontal framework instead (Hitt, 2020). The specified strategy has helped the company to maintain tighter control over its core processes (Wang et al., 2020). However, Microsoft has also incorporated the vertical integration principles into its corporate-level strategy when enhancing the popularity of its Game Pass service (Wang et al., 2020). Therefore, the diversity in Microsofts approaches defines its current success and allows it to retain its relevance, which suggests that the organization should continue implementing the related linked diversification framework as its corporate-level strategy.
Competitive Environment Analysis
Though Microsoft has been deploying the most innovative approaches in addressing the current economic situation in the global market, the current competitive environment has been creating additional obstacles for the company to overcome. When considering the competitive landscape of the IT market in which Microsoft operates, one might have assumed that only Apple can rival the power of Microsofts presence. However, there are quite a few competitors that pose a substantial threat to Microsofts presence in the global context. These are Google, Amazon, Cisco, IBM, Sony, and Oracle, to name just a few (Affeldt & Kesler, 2021). Though the companies in question share a range of similarities with Microsoft in terms of the services and products that they offer, the strategies that they deploy are quite different.
Apple
In its approach in the global IT market, Appel has been utilizing differentiation as its business-level strategy and operational and corporate relatedness as a corporate-level one. The specified frameworks have helped it to retain its competitive advantage of an innovation-driven company. The specified approaches are eerily similar to those of Microsoft, which is justified by the similarities in the product type and customer base that the organizations have selected.
In turn, Google has been evolving toward embracing a broad range of clouding opportunities and the associated options. The specified choice has defined its business-level strategy as that one of integrated cost leadership and differentiation (Affeldt & Kesler, 2021). In turn, Googles corporate-level approach can be described as related linked since the company has been striving to control and share activities between different areas of business (Affeldt & Kesler, 2021). Therefore, Google represents a major threat to Microsoft as a dangerous rival.
Amazon
In turn, Amazons business-level strategy clearly revolves around the cost leadership approach. Specifically, the organization has been striving to minimize costs, thus, increasing the output and increasing the access to its services for all citizens (Affeldt & Kesler, 2021). The specified framework aligns with the companys corporate-level strategy, which is currently clearly represented by the integrated cost leadership/differentiation model.
Cisco
Unlike Amazon, Cisco has been engaging in differentiation practices actively, which has defined its business-level strategy and predetermined its corporate-level approach. Specifically, the use of cost leadership as a framework for the broader market can be seen in Ciscos current efforts to maintain its success streak. The specified characteristics make Cisco a rather prominent competitor for Microsoft, which means that it may pose obstacles to the firms further progress.
IBM
Similarly, IBM has been engaging in differentiation strategies as the main approach toward managing its resources. The specified framework suggests that IBM does not pose a direct threat to Microsofts performance. However, its operational and corporate relatedness model enhances its competitive advantage substantively. Therefore, Microsoft will need to continue to examine the development of IBMs influence in the global market so that it could act accordingly.
Sony
Finally, Sony evidently seeks to minimize costs while also catering to the needs of a rather heterogeneous audience, which means that its business-level approach can be described as cost leadership. In turn, the propensity toward operational relatedness makes its corporate-level strategy a related linked one. Therefore, while Sony does not pose an immediate threat to Microsoft, it has the potential to interfere with some of the aspects of Microsofts performance.
Competitive Environment Conclusion
Overall, each of the companies listed above has rather strong potential in the global IT market. However, one should note that, as Microsoft competitors, only two can be seen as likely disruptions in Microsofts performance. Namely, these are Google and Apple, which have4 been demonstrating a streak of incredible success over the past couple of years (Wang et al., 2020). Furthermore, the consistency in their performance compared to their past results proves that both have a strong chance to outweigh Microsoft in the fight for dominance within the IT market. Specifically, Apple seems to have the greatest chances to win given the similarities in its business- and corporate-level strategies, as well as its produict6s and services. Therefore, it is strongly advised that Microsoft should introduce even more efficient business- and corporate-level strategies that would allow the organization to adjust to the likely changes in the highly competitive environment of the selected market an thrive in the presence of competitors as powerful as Apple and Google.
For this purpose, Microsoft will have to revisit its approach to structuring its corporate-level strategy. Specifically, the firm should consider a focus on expansion, which will require shifting its business-level framework toward greater diversification. As a result, Microsoft will be able to explore the opportunities related to the changes in its corporate culture and organizational philosophy, considering the concept of incremental innovation as one of the possible solutions to its current situation.
Market Cycles
While the current approach to addressing Microsofts framework for managing essential tasks seems to be sufficient, one should also recognize the necessity for a company to be flexible and easily adjustable to different market environments. Therefore, the framework that Microsoft has been adopting at the business and corporate levels should be examined from the specified standpoint as well. In essence, the speed of price trending, the low one represented by the Slow Cycle, and the quick one being modelled as a Fast one, encourages companies to have their business- and corporate-level strategies top reflect the specified characteristics of the economic setting accordingly. For Microsoft, which functions in the quick-cycle context, the transfer to the low-cycle setting would lead to a shift toward related constrained differentiation framework as the means of maintaining its influence in the market.
Sources
Affeldt, P., & Kesler, R. (2021). Big tech acquisitionstowards empirical evidence. Journal of European Competition Law & Practice, 12(6), 471-478. Web.
Hitt, M. A. (2020). Strategic management: Concepts and cases: Competitiveness and globalization (13th ed.). Cengage Learning.
Wang, K., Shen, Z., Huang, C., Wu, C. H., Dong, Y., & Kanakia, A. (2020). Microsoft academic graph: When experts are not enough. Quantitative Science Studies, 1(1), 396-413. Web.
Order from us for quality, customized work in due time of your choice.