Table of Contents
Introduction
Microsoft Corporation began with software development and creation of operating systems as well as office software productivity for personal computers (PCs). The firm’s headquarters are in Redmond, Washington. Currently, the firm is creating as well as giving support to numerous software products for a number of computing devices globally. According to MSFT (2006), the firm has seven main product sectors and among them includes MSN and Clients among others. Importantly, the company is listed in the New York Stock Exchange. In the current information age, Microsoft has managed to remain a redoubtable competitor through leadership in corporate as well as consumer markets and through its technical innovations. In this excerpt, the mission and vision of the company are analyzed plus the company financials using the current data on Yahoo finance and Bloomberg. Nonetheless, the future of a company cannot be predicted using the judgment on past performance, as it is impossible to foretell the future (Brigham & Houston, 2004).
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Mission and Vision Analysis of Microsoft Corporation
Mission is the reflection of an organization in terms of the type of services or products an organization produces, which holds certain value to its consumers (Hill & Jones, 2007). In this regard, Microsoft’s mission is to assist individuals as well as businesses all across the globe to recognize their full capability. The mission is considered a promise to Microsoft clients. The firm delivers on the promise through endeavoring to create accessible technology to all people irrespective of their ages and capabilities. The firm leads in accessibility innovation in the industry in addition to leading in building safer and easy to use products.
Therefore, their mission is in line with the company’s strategy in terms of technology accessibility. The accessibility assists visually impaired persons, those with hands difficulties, hearing problems, cognitive and speech challenged people. With regard to computers, the accessible technology can be explained in three aspects, first accessibility options that allow one to personalize his/her computer display plus other devices, such as the mouse and sound. Second are assistive devices, which are specialty software as well as hardware products; for instance, screen readers, which offer crucial computer access to people with considerable language and vision difficulties among others. Third is interoperability amid assistive devices, software programs, as well as the operating system that help the assistive technology to work appropriately.
According to Hitt, Ireland and Hoskisson (2012), a vision statement is referred to a statement used in describing an organization by pointing out organization’s expectations in the future. A vision statement thus focuses on implementing decisions and strategies to pave for business’s future (Hitt, Ireland & Hoskisson, 2012). Microsoft vision statement is, “to get a workstation running Microsoft’s software onto every desk and eventually in every home.” In a bid to achieve its vision, Microsoft engages its employees strategically as in they are experienced, devoted to meet the company’s goals, and zealous about their work. They understand that the company’s clients are the main significant asset for the firm. The managers create a favorable environment that promotes creativity as well as a focus on quality and clients satisfaction. Every worker takes part in the quality process making sure that clients obtain the company’s best effort, each time. They are 89, 809 employees in total in 105 nations and their growth rate approximates to 11.3%. In this regard, it is clear that Microsoft is internationalized, a strategy that helps to the firm to achieve its mission and vision.
Strategy
Strategy in business refers to a plan of action directed to attainment of a certain objective (Bungay, 2011). Accessibility is part of a business practice employed by Microsoft Corporation and it focuses on responsibility and integrity. The accessibility strategic approach focuses on integrating accessibility in design, planning, research, testing development and documentation. The accessibility strategic approach by Microsoft is achieved by a continued longstanding leadership and commitment in developing accessibility solutions through innovations. The business also makes computers in a way such that they are easier to be seen, heard and used through creating accessibility into their products and services. The next strategy of the company is through promotion of innovativeness of accessibility in development of the community in addition to working with organizations or industries to encourage innovation. Microsoft Corporation also builds collaborative and strong relationships with a number of different companies based on technology organizations in a bid to scale up the awareness of the significance of accessibility to meet technological needs of disabled people. Another strategy employed is inclusion and diversity. This ensures provision of leadership as well as development programs to give employees necessary knowledge and skills to perform well their duties.
Financial Analysis
The profits of Microsoft Corporation resulted from its mission, vision, and strategies whose combination brought solid growth as well as rigorous discipline in costs resulting in double-digit income growth. This was experienced in the last quarter of the fiscal year 2012. Key strategies ensured that the corporation delivered to its shareholders. Microsoft’s fiscal year 2012 had the company’s operating income, earnings per share and revenue, at $21.76 billion, $2.00 per share and $73.72 billion respectively. An Adjustment of the goodwill charge impairment and the revenue deferred, operating income, and earnings for each share were at 74.26 billion dollars, 28.50 billion dollars, and 2.78 dollars per share. This represented rises by 6 percent, 5 percent, and 5%, respectively.
The Business Division for Microsoft revenue increased by 7 percent in the full year and 7% in the last fourth quarter. This is reflected by the continued rise in sales of Office 2010. The revenue of the division dealing with Online Services grew by 8% in the last quarter while the full year represented a 10% increase. The devices and entertainment increased their revenue by 8% for the whole year due to diversification strategy of adding Skype to its product lines. Delivering for the fiscal year 2012 required the company to take great solutions and products, services, and also tremendous work by its people, which are all in line with the company’s vision, mission and strategies.
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The current market that Microsoft Corporation is operating in is very competitive. They are many competitors mainly those vending software applications; for instance, Google, Novell, Sun Microsystems Apple, IBM, Red Hat, and Oracle among others. IBM as well as Corel possesses measureable established foundations with their office productivity products. On the other hand, Apple can distribute some of their application software devices with numerous kinds of their PCs. Microsoft Incorporation competition is varied depending on the size as well as the geographical location of the clients for whom the firm is competing. Microsoft competes with popular vendors; for instance, Intuit in the market with a focus on offering solutions for businesses, both small and medium sized. The market for big firms and categories of worldwide enterprises go on being intensely competitive. In addition, the bug enterprise-focused sellers are repositioning certain of their applications to center on small and medium sized traders. Microsoft Corporation believes that its merchandise competes efficiently with the vendors basing their strategy on offering integrated, adjustable solutions, which work as and with the company’s technologies, its clients already have.
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A market’s competition can be evaluated by assessing the strengths and opportunities of a company. Therefore, it is essential to carry out competitive analysis that will look at firm’s strengths and opportunities (Simoneaux & Stroud, 2011)
Strengths
Microsoft is the number one operating system in the entire globe. There were more than 1.1 billion computers across the globe as of 2012 with 90% of them using Microsoft Windows. The company led in 2012 in marketing campaign. In the workplace, the company still leads. It was predicted that by 2013, the worldwide enterprise market would be valued $68 billion. The largest portion would go to Microsoft. The company earns in one quarter what Apple earns in one year from the sales of business hardware and services. The company’s reputation is strong as it was listed seventh on Forbes. Microsoft leads in gaming; it I currently the leading seller company of gaming console globally. The company has a 97% market share for MS Office. With Skype, the company has more than 280 million users (Spencer, 2012). The company has in cash; more than $65
million, cash equivalents, as well as short-term, exceedingly liquid investments not in use in addition to a market cap approximately $241.15 billion.
Opportunities
The monetization of search has improved; in the first quarter of 2013 of Microsoft fiscal year, online advertising earnings grew by 15%. The growth was driven fundamentally by a rise in earning per search, with regard to the firm’s earnings release for the time. Another opportunity is Windows 8; so far, the firm has recorded an installation of 4 million. If Win8 is successfully launched, the sales would increase. Although the company is still young on its app ecosystem because its iPad has not been a killer, many reviewers accept that a 2.0 Surface would threaten the current dominance of Apple’s tablet space. Last, The Win 8 UI is the initial mobile interface, which numerous clients will ever come across (Spencer, 2012). Fortunately, the company may obtain an edge from this in the developing globe, which is currently being enjoyed by its competitors.
Strategy that will Maximize Microsoft’s Return to Shareholders
Differentiation is Microsoft’s profit maximization strategy to return to shareholders. The rationale behind this choice is because Microsoft has managed to return to shareholders even during difficult economic times by investing in IT as a chief differentiator, which helps to promote productivity, decrease costs, as well as accelerate agility. Microsoft has been able to offer highly quality products at a reduced cost because of deep product integration. For instance, Microsoft SQL Server 2008 has integrated the capacities of business intelligence, online processing of transactions, as well as data warehousing, which is about 96% cheaper than competing products.
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