Posts by John Dudovskiy
Microsoft corporate social responsibility (CSR) is guided by the citizenship mission of the company which is “to serve globally the needs of communities and fulfil our responsibilities to the public”. Moreover, charitable activities of Bill & Melinda Gates Foundation founded by Microsoft founder Bill Gates is also associated with Microsoft in the perception of the general public to a certain extent. The technology giant won a number of awards and achievements for its responsible behaviour. These include ranking #1 on Corporate Responsibility Magazine’s 100 Best Corporate Citizens 2018, ranking #1 for both, Environment and Social Score which measures corporate performance using more than 200 factors. Moreover, Microsoft’s behavior as a socially responsible company has earned number 2 spot on JUST Capital’s Top 10 Tech Companies. Microsoft CSR Programs and Initiatives Microsoft Supporting Local Communities Microsoft employees donated USD158 million to non-profits serving its local communities and the world The Lagos Solar project in Nigeria uses batteries that are charged by solar panels, along with intelligent inverters connected to Microsoft Azure Internet of Things technology International software provider Temenos relies on Microsoft Cloud services to reach people across Myanmar who lack access to banking, giving them opportunities for more financial stability and access to microcredit and other financial services. Microsoft’s 4Afrika Initiative provides a set of programs to empower African youth, entrepreneurs, developers and business and civic leaders YouthSpark initiative aims to empower 300 million young people around the world with opportunities for education, employment, and entrepreneurship Microsoft Educating and Empowering Workers Microsoft collects employee feedbacks through multiple channels and acts on them. As part of this initiative nearly 85 percent of our more than 117,000 employees responded employee survey 92% of surveyed stated they feel proud to work at Microsoft and 87% of employees would recommend Microsoft as a great…
Microsoft ecosystem integrates the following types of products and services: Category Products and services Productivity and Business Processes Microsoft 365, SharePoint, Skype for Business, Outlook Mobile, One Drive, Dynamics 365, Microsoft Teams, Linked In Intelligent Cloud Server products and cloud services, including SQL Server, Windows Server, Visual Studio, System Center, and related CALs, as well as Azure Enterprise Services, including Premier Support Services and Microsoft Consulting Services More Personal Computing Windows Devices, including Microsoft Surface (“Surface”), phones, and PC accessories. Gaming, including Xbox hardware; Xbox Live, Search advertising. Products and services within Microsoft Ecosystem It can be argued that Microsoft ecosystem is aimed at enterprise customers to a greater extent compared to individual users. Specifically, Microsoft enterprise products and cloud services are effectively tied together and this generates strong incentives for businesses to use Microsoft products and services. For example, OneDrive for Business leads into Sharepoint, Teams integrates with Outlook and is about to swallow Skype for Business, Dynamics CRM and SQL Server can integrate and pull data from Azure AD. Moreover, there are many Office 365 programs and services that integrate with each other under a single sign-on. Similarly, Windows ecosystem which includes the platform, games, apps, the Store, and Minecraft, as well as the Windows 10 family of devices, including Surface, Xbox, and HoloLens. the multinational technology company is expected to further invest into its ecosystem to make it stronger in the medium-term and long-term perspectives. Microsoft Corporation Report contains a full analysis of Microsoft ecosystem. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis, Ansoff Matrix and McKinsey 7S Model on Microsoft. Moreover, the report contains analyses of Microsoft leadership, business strategy, organizational structure and organizational culture. The report also comprises…
Microsoft McKinsey 7S model shows how seven elements of businesses can be aligned to increase effectiveness. According to this framework, strategy, structure and systems represent hard elements, whereas shared values, skills, style and staff are soft elements. McKinsey 7S model stresses the presence of strong links between elements in a way that a change in one element causes changes in others. As it is illustrated in figure below, shared values are positioned at the core of Microsoft McKinsey 7S model, since shared values guide employee behaviour with implications in their performance. Microsoft McKinsey 7S model Hard Elements in Microsoft McKinsey 7S Model Strategy. Microsoft business strategy can be classified as product differentiation. The company develops advanced technology products and services and sells them for premium costs. Moreover, Microsoft business strategy is currently focused on “cloud-first, mobile-first”, growth through mergers and acquisitions and exploring business opportunities related to augmented and virtual reality. As the latest addition to its business strategy, the multinational technology company is focusing on the concept of ‘tech intensity’, which aims to position Azure as the worlds’ computer with evident positive implications on the long-term growth prospects of the business. Structure. Microsoft organizational structure is divisional and such a structure resulted from a restructuring initiative introduced by CEO Satya Nadella in 2015. Microsoft engineering group is divided into three divisions: Cloud and AI Group, Experiences + Devices and Artificial Intelligence and Research. Business functions, on the other hand, are divided into nine divisions. Microsoft corporate structure is highly dynamic and ever-evolving to meet the demands of changing external market place. Systems. There is a wide range of systems that are critically important to run Microsoft successfully. These include employee recruitment and selection system, team development and orientation system, transaction processing systems, customer relationship management system, business…
Microsoft value chain analysis is an analytical framework that assists in identifying business activities that can create value and competitive advantage to the business. Figure 1 below illustrates the essence of Microsoft value chain analysis. Figure 1 Microsoft Value Chain Analysis Microsoft Primary Activities Microsoft Inbound logistics Microsoft contracts with multiple suppliers internationally, as illustrated in Figure 2 below. Accordingly, the company has to maintain highly complicated supply-chain operations without any disruptions. It is compulsory of all suppliers to adhere to Microsoft Supplier Code of Conduct and The Microsoft Supplier Requirements. The main sources of value for Microsoft inbound logistics include the economies of scale, presence of strategic relationships with suppliers and in-depth knowledge of supply-chain management practices due to selling relevant software i.e. Microsoft Dynamics AX. Figure 2 Microsoft production supplier locations[1] Microsoft Operations Microsoft Corporation business is divided into the following three operating segments: 1. Productivity and Business Processes. This segment comprises Microsoft products and services related to productivity, communication, and information services. The segment comprises a range of devices and platforms such as Office Commercial, Office Consumer LinkedIn and Dynamics. 2. Intelligent Cloud. This operating segment includes public, private, and hybrid server products and cloud services that can power modern business. Intelligent Cloud segment comprises server products such as SQL Server, Windows Server, Visual Studio, System Center, and related CALs, and Azure, as well as, Enterprise Services, such as Support Services and Microsoft Consulting Services. 3. More Personal Computing. This segment consists of products and services geared towards harmonizing the interests of end users, developers, and IT professionals across screens of all sizes. Microsoft’s regional centre in Ireland supports the European, Middle Eastern, and African region; the centre in Singapore supports the Japan, India, Greater China, and Asia-Pacific region; and the centres in Fargo, North…
Porter’s Five Forces analytical framework developed by Michael Porter (1979)[1] represents five individual forces that shape an overall extent of competition in the industry. Microsoft Porter’s Five Forces are illustrated in figure below: Microsoft Porter’s Five Forces Analysis Threat of substitute products or services in Microsoft Porter’s Five Forces Analysis Threat of substitute products or services for Microsoft is low. The following factors determine the level of threat of substitute products or services for the multinational technology company: 1. Lack of direct substitutes. Range of products offered by Microsoft include operating systems for computing devices, servers, phones, and other intelligent devices; server applications for distributed computing environments; productivity applications; business solution applications; desktop and server management tools; software development tools; video games; and online advertising. The company also designs and sells hardware including PCs, tablets, gaming and entertainment consoles, phones, other intelligent devices, and related accessories. Additionally, Microsoft offers a wide range of software applications and cloud-based computing services such as Bing, Microsoft Azure, Microsoft Dynamics CRM Online, Microsoft Office 365, OneDrive, Skype, Xbox Live, and Yammer. There is no direct substitution for these products and services, however, indirect substitution exists. Indirect substitution for Microsoft products and services belonging to productivity and business processes segment include a wide range of stationary products, planners and organizers. Indirect substitution for Microsoft gaming and recreation products, on the other hand, include but not limited to music, movies, sports, spending time with friends and family members etc. 2. Low buyer propensity to substitute. The level of buyer propensity to choose substitute products or services to Microsoft’s products and services can be assessed as low. This is because according to its mission ‘to empower every person and every organization on the planet to achieve more’, Microsoft products and services are highly convenient to use.…
Microsoft Ansoff Matrix is a marketing planning model that helps the multinational technology company to select its product and market strategy. Ansoff Matrix distinguishes between four different strategy options available for businesses. These business growth strategies are market penetration, product development, market development and diversification. Microsoft Ansoff Matrix Microsoft uses all four strategy options within the scope of Ansoff Growth Matrix in an integrated way. 1. Market penetration. Market penetration refers to selling existing products to existing markets. Microsoft uses market penetration strategy to sell its Windows software and devices and other products in 116 Microsoft stores worldwide as well as through online channels and authorised distributors. The multinational technology company uses Microsoft Rewards loyalty program to pursue its market penetration strategy. 2. Product development. This growth strategy involves developing new products to sell to existing markets. Microsoft engages in product development strategy systematically. The tech giant’s research and development expenses increased USD 1.7 billion or 13% in 2018 compared to the previous year.[1] Microsoft develops most of its products and services internally through three engineering groups. Applications and Services Engineering Group, focuses on broad applications and services core technologies in productivity, communication, education, search, and other information categories. Cloud and Enterprise Engineering Group, focuses on our cloud infrastructure, server, database, CRM, enterprise resource planning, management, development tools, and other business process applications and services for enterprises. Windows and Devices Engineering Group, focuses on our Windows platform across devices of all types, hardware development of our devices, and associated online marketplaces. 3. Market development. Market development strategy is associated with finding new markets for existing products. Microsoft enters a new market whenever it sees there potential for its products and services. For example, HoloLens was made initially available only in 10 countries such as United States, United Kingdom, Canada, Australia…
Microsoft marketing communication mix explains the patterns of use of elements of marketing communication such as advertising, sales promotion, events and experiences, public relations, direct marketing and personal selling by the multinational technology company. Microsoft Print and Media Advertising Print and media advertising is placed at the core of Microsoft marketing strategy. Microsoft print and media advertising expenses amounted to USD 1.6 billion, USD 1.5 billion, and USD 1.6 billion in fiscal years 2018, 2017, and 2016, respectively[1]. As illustrated in figure below, Microsoft’s print and media advertising campaigns make an appeal to needs, wishes and aspirations of target customer segment and positions Microsoft products and services as efficient tools to be used to satisfy them. Example of Microsoft print advertisement Some of Microsoft’s TV advertisements such as “the apps you want” 30-second commercial that promotes unified Windows Store within Windows Phone and Windows 8 have become viral videos in social networking sites mainly due to engaging presentation of information. Moreover, as an unprecedented move the company has placed a Wi-Fi-Enabled print advertising promotion in a special edition of Forbes magazine targeting a selected group of subscribers. Ultra-thin router and battery placed within pages of magazine granted the possibility of free internet browsing for about 3 hours. Moreover, the global technology company has been gradually shifting its focus from traditional media such to the social media and other online platforms. Microsoft Sales Promotions Sales promotion is used by Microsoft in a frequent manner in both store formats – physical and online. Microsoft sales promotions include the following: 1. Seasonal sales promotions. Microsoft offers 12 Days of Faves promotions, during Christmas and New Year holidays. Additional seasonal sales include Black Friday and Cyber Monday. 2. Discount codes. The company offers special education-designated Microsoft coupons for students, parents, faculty, and…
PESTEL is a strategic analytical tool and the acronym stands for political, economic, social, technological, environmental and legal factors. Microsoft PESTEL analysis examines effects of these factors on the bottom line of the multinational technology company. Political Factors in Microsoft PESTEL Analysis There are many political factors within the scope of Microsoft PESTEL analysis at governmental, regional and international levels. Apart from the impact of a regular set of political factors such as political stability in the market, impact of activities of lobby groups and the government attitude towards the organization and the industry, Microsoft activities during the past years have brought upon the company other set of political issues. Most notably, Microsoft has attracted the attention of governments and political parties due to antitrust-related issues. A recent probe by China’s State Administration for Industry and Commerce into the ways Microsoft distributes its Internet Explorer browser and Windows Media Player and sells its Office and Windows software in China[1] can be mentioned as a relevant example of impact of a political factor. Similar to major international corporations, Microsoft engages in political lobbying in order to contribute to the formation of political environment favourable to its business. As illustrated in figure below, the amount of annual political lobbying by Microsoft has ranged between USD 3,92 million and USD 7,25 million during the last 10 years. Annual lobbying by Microsoft Corporation[2] Economic Factors in Microsoft PESTEL Analysis There is a range of economic factors that affect Microsoft revenues directly or indirectly. These include economic growth or recession in the market, changes in interest rates and currency exchange rates, changes in taxation rates and policies, inflation rates, changes of labour costs and costs of other resources and others. Particularly, the global economic and financial crisis of 2007 – 2009 had proved to…
SWOT is an acronym for strengths, weaknesses, opportunities and threats related to organizations. The following table illustrates Microsoft SWOT analysis: Strengths 1. Global leadership in cloud sector 2. Effective leadership by Satya Nadella 3. High profitability of the business and solid financial position 4. The most valuable company in the world 5. Diversified product portfolio Weaknesses 1. Lack of innovation 2. Weak position of Microsoft Edge browser application 3. Occasional technical issues with Windows updates 4. Dependence on hardware manufacturers 5. Security issues of Microsoft products Opportunities 1. Engagement in mergers and acquisitions 2. Developing innovative products and services 3. Focusing on smartphone segment 4. Developing mobile advertising 5. Enhancing security against cybercrime Threats 1. Exchange rate risks 2. Emergence of new competitors 3. Anti-monopoly and other lawsuits 4. Economic crisis 5. Emergence of CSR-related scandals Microsoft SWOT analysis Strengths in Microsoft SWOT Analysis 1. Microsoft is an undisputed leader in global marketplace in cloud segment. The technology giant offers a wide range of cloud-based computing services that include Bing, Microsoft Azure, Microsoft Dynamics CRM Online, Microsoft Office 365, OneDrive, Skype, Xbox Live, and Yammer. In 2018, Microsoft had global datacenter footprint to 54 regions – more than any other cloud provider. In the same year, the revenues of Azure hyperscale cloud grew 91 percent year-over-year. Moreover, Microsoft added nearly 500 new Azure capabilities in 2017 alone.[1] 2. Effective and visionary leadership by Satya Nadella is one of the factors that set apart Microsoft from competition in positive terms. Since taking over from Steve Ballmer as Microsoft CEO in 2014, Nadella has been bold and effective in restructuring and reinvention of the company. Initiatives such as refocusingMicrosoft’s mobile-based efforts and expanding many of its services to be offered on other platforms like Mac introduced by Nadella has proved to be…
The origins of Microsoft organizational culture have been laid by founders Bill Gates and Paul Allen as an innovative, but performance-obsessed. From its founding in 1972, the technology company became a market leader in a range of segments partially thanks to its corporate culture associated with efficiency and creativity. However, this changed during Steve Ballmer leadership era covering 2000-2014 with negative implications on company’s market share and stock prices. After assuming the top job in 2014, rebooting Microsoft organizational culture was one of the key tasks for the new CEO Satya Nadella. Currently, the global technology company is actively placing One Microsoft concept at the core of its organizational culture. Microsoft organizational culture combines the following three key features. 1. Learn-it-all mentality. Nadella is credited with transforming Microsoft’s historical ‘know-it-all’ culture into ‘learn-it-all’ curiosity.[1] Nowadays, Microsoft corporate culture accepts that no employee can know everything about the industry and their specialty. At the same time, organizational culture at Microsoft encourages its employees at all levels to maintain an open mind towards learning new skills and capabilities that will help them to do their jobs better in a systematic manner. 2. Openness. CEO Satya Nadella told in an interview that anyone should be able to tell him anything and that’s the culture they strive for[2]. Moreover, industry analysts also note that “since chief executive Satya Nadella was appointed in February 2014, Microsoft has become a far more open place”[3] 3. Value for innovation. Under the leadership of former CEO Steve Ballmer, the global technology company was often criticized for the lack of innovations in its product portfolio. Satya Nadella has announced his commitment to change this perception by integrating the values of innovation and creativity into Microsoft organizational culture. 4. Diversity and inclusion. The company attempts to promote the culture of…