Swot Analysis of "Microsoft Corp.'s Pricing Policies" written by Anita M. McGahan, Julia Kou includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Antitrust Arose facing as an external strategic factors. Some of the topics covered in Microsoft Corp.'s Pricing Policies case study are - Strategic Management Strategies, Competition, IT and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Microsoft Corp.'s Pricing Policies casestudy better are - – central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, there is backlash against globalization, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, increasing transportation and logistics costs,
customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, etc
Introduction to SWOT Analysis of Microsoft Corp.'s Pricing Policies
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Microsoft Corp.'s Pricing Policies case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Antitrust Arose, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Antitrust Arose operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Microsoft Corp.'s Pricing Policies can be done for the following purposes –
1. Strategic planning using facts provided in Microsoft Corp.'s Pricing Policies case study
2. Improving business portfolio management of Antitrust Arose
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Antitrust Arose
Strengths Microsoft Corp.'s Pricing Policies | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Antitrust Arose in Microsoft Corp.'s Pricing Policies Harvard Business Review case study are -
Diverse revenue streams
– Antitrust Arose is present in almost all the verticals within the industry. This has provided firm in Microsoft Corp.'s Pricing Policies case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Effective Research and Development (R&D)
– Antitrust Arose has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Microsoft Corp.'s Pricing Policies - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Antitrust Arose is one of the leading recruiters in the industry. Managers in the Microsoft Corp.'s Pricing Policies are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Antitrust Arose digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Antitrust Arose has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Organizational Resilience of Antitrust Arose
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Antitrust Arose does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Strategy & Execution industry
– Microsoft Corp.'s Pricing Policies firm has clearly differentiated products in the market place. This has enabled Antitrust Arose to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Antitrust Arose to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Antitrust Arose in the sector have low bargaining power. Microsoft Corp.'s Pricing Policies has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Antitrust Arose to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Antitrust Arose has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Microsoft Corp.'s Pricing Policies Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Cross disciplinary teams
– Horizontal connected teams at the Antitrust Arose are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Learning organization
- Antitrust Arose is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Antitrust Arose is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Microsoft Corp.'s Pricing Policies Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Antitrust Arose has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Operational resilience
– The operational resilience strategy in the Microsoft Corp.'s Pricing Policies Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Weaknesses Microsoft Corp.'s Pricing Policies | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Microsoft Corp.'s Pricing Policies are -
Interest costs
– Compare to the competition, Antitrust Arose has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Antitrust Arose supply chain. Even after few cautionary changes mentioned in the HBR case study - Microsoft Corp.'s Pricing Policies, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Antitrust Arose vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Microsoft Corp.'s Pricing Policies, is just above the industry average. Antitrust Arose needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Increasing silos among functional specialists
– The organizational structure of Antitrust Arose is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Antitrust Arose needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Antitrust Arose to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Antitrust Arose has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Microsoft Corp.'s Pricing Policies should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– It come across in the case study Microsoft Corp.'s Pricing Policies that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Microsoft Corp.'s Pricing Policies can leverage the sales team experience to cultivate customer relationships as Antitrust Arose is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Antitrust Arose is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Microsoft Corp.'s Pricing Policies can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As Microsoft Corp.'s Pricing Policies HBR case study mentions - Antitrust Arose takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
No frontier risks strategy
– After analyzing the HBR case study Microsoft Corp.'s Pricing Policies, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Skills based hiring
– The stress on hiring functional specialists at Antitrust Arose has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Anita M. McGahan, Julia Kou suggests that, Antitrust Arose is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Opportunities Microsoft Corp.'s Pricing Policies | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Microsoft Corp.'s Pricing Policies are -
Buying journey improvements
– Antitrust Arose can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Microsoft Corp.'s Pricing Policies suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Antitrust Arose can use these opportunities to build new business models that can help the communities that Antitrust Arose operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Antitrust Arose to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Leveraging digital technologies
– Antitrust Arose can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Antitrust Arose can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Antitrust Arose can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Antitrust Arose can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Antitrust Arose in the consumer business. Now Antitrust Arose can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Antitrust Arose to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Antitrust Arose in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Developing new processes and practices
– Antitrust Arose can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Antitrust Arose can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Microsoft Corp.'s Pricing Policies, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Antitrust Arose to increase its market reach. Antitrust Arose will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Antitrust Arose can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Microsoft Corp.'s Pricing Policies External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Microsoft Corp.'s Pricing Policies are -
Shortening product life cycle
– it is one of the major threat that Antitrust Arose is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Antitrust Arose will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Antitrust Arose in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Antitrust Arose business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Antitrust Arose can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Microsoft Corp.'s Pricing Policies .
Consumer confidence and its impact on Antitrust Arose demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Antitrust Arose in the Strategy & Execution sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Antitrust Arose can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
High dependence on third party suppliers
– Antitrust Arose high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Antitrust Arose with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Antitrust Arose.
Regulatory challenges
– Antitrust Arose needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Weighted SWOT Analysis of Microsoft Corp.'s Pricing Policies Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Microsoft Corp.'s Pricing Policies needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Microsoft Corp.'s Pricing Policies is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Microsoft Corp.'s Pricing Policies is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Microsoft Corp.'s Pricing Policies is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Antitrust Arose needs to make to build a sustainable competitive advantage.
