Introduction: Microsoft Corporation
Microsoft Corporation is based in the US and deals with manufacturing and development of software products applied in computers. The company develops variety of software which include; operating systems, server applications, business solution applications, information worker applications, high-performance computing applications, software development tools as well as MSN network which is an internet provider.
Microsoft’s operating system which has unique qualities in the market forms the major strength of the Company. The system provides dependable link between the computer and the user. In addition the Company also ventures into manufacturing application software as well multimedia market (Aaarkstores, 2010).
Microsoft Corporation is known to be technologically oriented company with most of its core processes operated electronically through avenues such as e-shops. The company heavily utilizes the use of online services and web-based information systems.
Such services as e-marketing provides the company with integrated means of reaching consumers hence allowing possible means of projecting current and future customer requirements within the market (Johnson et al, 2008, 51-59).
Figure 1: Microsoft and its competitors
Description of Customer Perceived value for the Company
Consumers are believed to always engage in internal and external processes of information search before attaching value to product or company. Internal information search involves the process through which consumer identifies all alternatives to the product/company from memory.
Such actions require companies to engage in aggressive programs which enable their various brands to become memorable to consumers and are mostly applicable to low involvement products or companies (Payne and Holt, 2001). While external search is applicable to high involving firms such as Microsoft as well as Apple amongst others.
In such a case organizations are advised to make available their product information through web sites. Consumers at the same time could use compensatory decisions which requires the consumers to critically analyze all the attributes of a company before pledging loyalty to them (Eggert and Ulaga, 2002).
Value should be examined from the customer point of view since expressions towards a product vary depending on the customer segment served. Within the various market segments, some customers tend to value more, certain product attributes compared to others.
High prices of products might represent high value to particular customer segment since the benefits are considered higher than money value attached to the product. In this case Microsoft’s operating system provides the customers with more useful ways of operating their computers (Barnes et al, 2009).
There is realization of increased productivity owing to easy communication through the integrated system which enables instant sharing of information.
There is faster and instant means of information sharing through the use of desktop applications as well as line of business which eliminates the essence of spending a lot of time in locating and communicating with partners. There is also sufficient access for customers whether travelling or at home and at the same time enables remote users to access directly security-enhanced presence without the use of Virtual Private Networking (VPN).
The operating system together with other Microsoft services enables business collaborations between organizations easier with a guarantee of protecting sensitive business information.
Microsoft services provide organization with connections through public IM data centres and Live Communications Server Internal users which enables effective connection between information workers and public IM services (Holbrook, 2003, pp 45-61).
Microsoft ensures the possibility of customers extending their current infrastructure investments by incorporating new technologies into the existing computing environments. For instance, the provision of Live Communications Server 2005 which forms part of Microsoft Windows server system which improves the functions of the collaboration infrastructure.
The software enables customers to share Ms Office and other applications from working station with other collaborative sessions such as encrypted IM. Microsoft Office System integration grants customers uninterrupted workflow system and at the same time enable Real-time communication with familiar Ms Office programs (Ahmed and Rafiq, 2002).
Consumers value Microsoft’s ability to eliminate communication delays within the business cycles with business partners through their advanced technology in Live Communications Server 2005. There is provision of instant access to business partners across organizational and geographical boundaries. This has accelerated improvement in business efficiency through familiar security enhancement.
Increased manageability, scalability and security are possible through development of Enterprise-Grade Real-time communications. Customers are as well provided with NT LAN Manager Capabilities which increases the control as well as the security of the supposed network through consolidating the necessary resources with Microsoft Windows Active Directory.
Companies benefit from real-time collaboration solutions enabling growth through easy scaling-up opportunities. This means that the up-time for enterprise communications is upgraded and at the same time the Microsoft SQL servers enables data recovery preventing further time and data loss.
The use of SQL-based Logging in Microsoft’s communication server makes it possible for internal auditing of the available IM transactions (Dubois, 2007).
Organizations at the same time are capable of enhancing the efficiency of their internal operations through application of various Microsoft services for the right duties. These include working together across departments with experts through contact centres. The process presence is enhanced through leveraging of knowledge and ideas hence enabling healthy advancement within entire enterprises.
At the same time there is the provision of building stronger customer relationships owing to the development in the unified customer touch points which reinforces relationships. The possibility of connecting to customers using appropriate tools is made possible through servers live communication links which has also made it possible what is referred to as agent-initiated cross-selling (Holbrook, 2003, pp 45-61).
The provision of familiar and modern Windows-Based management tools has assisted in simplifying the management and administrative tasks. Organizations are able to operate within timely schedules through new deployment tools.
The other value added to organizations apart from time management is that they can now save on training expenses through the use of soft wares such as Windows graphical user interface, which enables easy management of users, servers as well as global settings.
When integrated together with Live Communications Server 2005, windows-based management tools reduce server management and training costs (Woodruff, 1997).
Microsoft’s idea of rolling out new technologies within the market has met mixed reactions from the consumers. The company’s venture in developing Internet Explorer with Windows 98 and other integrated products has been at the centre of the antitrust suits.
This is seen as a direct assault on the company’s strategy on software development which is known to be innovatively involved in unveiling more features, technology and other products into their key components such as Windows NT, SQL server database, and E-mail Server Exchange. The strategies on all these innovations focuses on promoting functions and at the same time reduce prices.
The consumer reaction is generally mixed concerning the various practices involved since some view the advantages of the software bundles in terms of pricing as well as product integration while others view the processes as short-term applications (Holbrook, 1999). The company is also prepared to roll out its man flagship development tools as well as emerging middleware.
Microsoft at the same time plans to integrate developer’s toolkit systems which comprise AS/400, Oracle, DB2 and VSAM; in addition there is also bundling of Microsoft’s SNA Server. These soft wares would enable easy operations by large scale developers.
Microsoft’s automated and well organized system gives customers easy time when transacting their businesses and activities through the computers. Their operating system has enabled easy access to required websites enabling consumers to indicate every detail they require through websites hence making majority of work to be efficiently done.
The use of electronic sites provides the various steps necessary for completion of any business transactions between suppliers and consumers. The company also offer customers free trial version of their software’s on sale hence enabling buyer confidence after buying the product.
The company at the same time grants protection to its customers from fraudulent activities which may occur in the process business transactions. It operating system and software program enables application of all these activities (Ulaga and Eggert, 2005).
Microsoft Corporation designs programs which enable consumers to browse through products as fast as possible. The firm utilizes its strong brand for the purposes of driving sales of their software programs and other related services. The brand name at the same time is used for attraction purposes within the new market segments.
This is also utilized for the purposes of enhancing partnership between related companies operating within the same industry. The partnerships prove healthy towards market competition since they enable the process of co-branding of the new sites hence granting Microsoft a good market base for sale of its related products and services.
There is easier incorporation of activities and use of network systems such as MSN provided by Microsoft Corporation. Partnership with service providers enables the offer of enough space capable of handling new inventions for both small and established businesses (Piercy, 2009).
Evaluation of Existing Value Proposition
Clear definition of Company’s value proposition gives the required customer base. The value proposition helps in identifying the customers within the chosen market segments where the value seems most attractive. Microsoft has been able to face market competition owing to their simplicity of Integration between vendors and their systems. Such a strategy has not yet been adopted by other competitors such as Apple or Linux.
Microsoft servers are capable of running on Windows Platform making it easier for use by consumers. This has granted the Microsoft an advantage over their prime competitors since each contributor has to understand operations of Linux for easy working within the environment. Microsoft’s business model is different from other competitors within the market despite derivation of revenue as well as profit from the sales from the PC’s.
The difference comes from the selling of applications and also upgrades software’s to the base of PC’s. The company focuses on investing in new generation operating system and upgraded application software prices. The growth of the already installed base makes it impossible for competitors to match Microsoft’s current level of operation.
The company has got incentives for setting low prices to deal with the growth in the installed base. And at the same time set high prices for the productivity applications enabling the creation of stable financial base from the PC’s installed. The operation of Microsoft’s business models affects such elements as pricing, investment and time of release of new operating systems (Aaarkstores, 2010).
Good brand image forms a good basis for company’s future development and progress within the market. This has contributed to Microsoft being one of the sole leaders in computer software manufacturing. The Company utilizes the use of modern and upgraded technology in providing consumers with fine software and services associated with the preferred system.
Microsoft makes use of the available resources to provide and win considerable customer base hence an outstanding brand name. The company has supplied the market with high quality software products besides their operating system. At the same time their work environment contributes to the good image since they accord their staff considerable benefits and at the same time everybody treated as equal partners.
Strengthening its coverage requires the company to consider reinforcing its relationship with consumers and other potential partners within the marketplace. Microsoft’s level of creativity and innovative ability has been outstanding granting them competitive advantage over other players within the industry. This acts as a source of motivation to various companies willing to emulate their marketing strategies (Johnson et al, 2008, 51-59).
There is focus in providing efficiency through Microsoft’s products and services with the aim of capturing organizations. Generally Microsoft has upgraded most of their equipments from computers, websites, operating system and their software programs.
The appearing of their brand name on their products provides customers with the assurance of the products and services they are supplied with making the company enjoy global support from loyal clients. Their software engineers are professionally trained hence understands better market needs from professional point of view. This makes it difficult for pirates who are always in the process of selling counterfeit products (Aaarkstores, 2010).
Microsoft Corporation’s attribute of participating in corporate social responsibilities such as offering donations to institutions as well as not-for-profit organizations reinforces its good image.
The company is greatly involved in organizing seminars within various regions of the world and at the same time indulge in infrastructural development. Their services involve thorough training programs to customers through the company’s website and at the same time provide consumers with enough warrant time regarding some of their highly prized software (Aaarkstores, 2010).
Microsoft promotes its image in such manner as being actively involved in environmental issues. Research reveals that majority of consumers in America and other parts of the world are very conscious in buying products from companies which are environmentally conscious. Microsoft participates in community clean-ups besides donating their computers to schools and other institutions.
This has helped in improving and developing the image of the company amongst potential clients. Their interest in the well being of the community they serve earns the company greater value and favour amongst the population.
They also advance as far as partnering with the various environmental organizations in creating environmental awareness through their websites advising on the importance of conserving available natural resources (Johnson et al, 2008, 51-59).
Company’s business model is always dependant on array of players such as; competitors, substitutes, complementary organization, customers as well as suppliers. Microsoft for example complemented so well with Intel to provide the market with valuable products. However, much focus has been given to interdependences between competitors and at the same time between buyers and sellers.
Business models have the capability of either reinforcing each other or detracting through competition. Microsoft is currently present in various business sectors such as videogame systems as well as operating systems for the PDAs (Personal Digital Assistance) (Johnson et al, 2008, 51-59).
Microsoft Server has the capability of delivering instant messages providing scalable enterprise-grade solution. The system offers enhanced security, seamless integration alongside other Microsoft products and services. The company also offers necessary extensions in their industry-standard development platform.
Such upgraded services have enabled organizations to save on costs as well as gaining ground on improved business efficiencies, increased productivity, and improved security on Intellectual property through provision of easily managed and available solutions (Aaarkstores, 2010).
Microsoft bases their services in the presence of devices which enables instant messaging and at the same time revealing other devices readiness for communication. The devices provide complete picture concerning the user’s status and the nature of their alleged environment made possible through the use of Microsoft CRM. Customers are capable of predicting before time if their devices are ready and available for use.
The presence of groups enable point-and-click access initiating instant sharing hence decisions becomes easy to create through Microsoft office programs enabling easy team-centric communications (Aaarkstores, 2010).
The company has organized plans based on the available resources such as capital. Microsoft has stable capital base generated from great deal of cash on hand enabling them to capture available opportunities within the market. This gives them considerable advantage over small software firms having limited capital from cash on hand, hence forces the small firms to forego great investment opportunities.
Microsoft tends to make its strategic plans from corporate level concerning issues on providing high quality software and services to customers. Such plans always involve heavy and aggressive capital investment. At the same time the company makes plans at business unit level making it possible for the business to include additional services besides operating systems and applications software.
Such services include provision of internet services as well as video games. This means that the management team gets involved at different capacities making all decisions central to the assigned areas which make accountability easier (Zeithaml, 1988).
Microsoft at the same time makes plans at the functional level allowing the specialization and accountability easier. Such strategy is applicable especially in marketing where prices of Microsoft software requires adjustment based on the increasing demand. The company’s scope needs reasonable definition for the purposes of capturing the existing market opportunities.
Therefore, Microsoft needs not to identify itself only as Computer Company since such definition may limit the nature of services provided. The mission of the company incorporates in broad terms the different groups of consumer segments served with appropriate technology involved (Frow and Payne, 2008).
Figure 2: Diagram showing the processes for on-line sale of an Item
Compare and contrast the value proposition with that of the leading competitor in your sector
Both Microsoft and Apple Inc aim at satisfying the needs of their respective customers. This is since potential customers differ in their satisfaction levels and at the same time not all customers have the same needs. Different kinds of customers have got different types of preferences and needs more than that which organizations can handle.
Different segments carry varied weights based on the kind of needs demanded hence require change in marketing mix used. However, both companies apply the use of differentiation methods for the purposes of reaching their targeted customers. They all fine-tune the elements of their respective marketing mix for the sale of computer products and services.
The volume of sales made on the PC’s at particular times depends on the nature of customer value attached to the microprocessor as well as the operating system. The other low values are captured through OS pricing which also determines the coordination between microprocessor and operating system. Previously Apple’s iPod dominated the market as it was seen to be portable as well as its capability to handle digital player segment.
The device made Apple Inc to hold over 75% of the US market share since the year 2001. However, the device got a big challenge when Microsoft launched similar device referred to as Zune in the iPod segment. Zune attracted more interest and attention compared to Apple’s ipod in terms of features and pricing forcing Apple to reduce its prices by $ 50 in the year 2006.
At the same time Microsoft launched a competitive browser to match Mozilla’s Firefox, the browser referred to as Internet Explorer 7 assisted the company in recovering the market segment lost since the year 2004. The software incorporated various features adopted from Mozilla such as integrated search window, tab browsing as well as pop-up window blocker.
Such development was countered by Mozilla through release of Firefox 2 which was much up-graded. The strategy sparkled war between the two entities since they each wanted to dominate the market (Fifield, 2007).
In conclusion, Microsoft Corporation stands as one of the most successful firms having great deal of technology alongside experienced staff capable of designing software. Their image value wins them considerable market share and respected brand name. However, some units of Microsoft records losses making MSN incapable of achieving desired targets within the market.
Besides, the company is faced by various threats which include rapid development from other sectors owing to high economic growth and economic downturn which has affected normal operations owing to high energy costs. Despite all these, Microsoft always takes the opportunity of having strong brand name within the market, hence enabling them to venture into the hardware market.
Strong brand name has enabled the company to become trusted source of consumer services in spite of the low sales recorded during recession. Few weaknesses experienced within the company calls for wise decisions in the area of resource allocations. Microsoft is capable of promoting this by pumping enough resources into MSN owing to their good financial base (Andreson et al, 2006).
Implementation of new value proposition that will match the value criteria of customers
The firm should fulfil its social responsibilities by participating in environmental programs. This has so far enabled Microsoft to win consumer loyalty and at the same time improve its public policies. At the same time the company’s public relations helps in the process of reinforcing their marketing techniques through the internet search engines.
The process assist in improvement of sales owing to the fact majority of the customers are capable of applying the use of internet technology. Integration of marketing communication software within Microsoft business system prove vital to the organization since it assists in coordination of strategic transactions within the firm.
Public relations have since helped the firm in effective communication since they are able to link directly to customers giving right information about their various products and services. This provides uniqueness of products within the market giving the company ability to attract consumers through their captivating information displays.
At the same time it is possible for the firm to earn political goodwill through its social and charitable actions. Microsoft is also capable of foregoing temporary profits through temporal reduction in prices for the purposes of attracting attention hence increasing the demand. Specific actions such as increasing the market share through gaining more distribution stores are of concern to Microsoft.
Appropriateness as one of the attributes of Microsoft’s resources should be considered, since it determines the level of financial performance which ultimately leads to attraction of investors. The attribute ensures full utilization of research and development which assist the firm in financing of innovative activities and production of new devices.
The nature of financial base also largely determines the various profitable activities guaranteeing the company’s sales. In the same line sustainability also represents one of the most crucial attribute of the business models. This is since the uniqueness of the product determines the duration of sustained earnings from the sales of the product (Kotler et al, 2009).
Major achievement is enablement of First-Contact resolution where presence of employees is determined through real-time. This reinforces communication since availability of clients is easily detected through available media. There are always frustrations on the side of consumers especially when they are unable to reach their correspondents with right information at the right time (Ulaga and Chacour, 2001).
Products and services provided by the company are currently selling hence having value for the market. This should make the Company to involve provision of other related services enabling the sale of computers hence acting as rich sources of the company’s revenue.
Microsoft Company should at the same time cooperate with vendors within the supply chain to enable extension of their additional services for the convenience of their clients. At the same time the firm offers training facilities to clients hence helping them improve on their online application skills.
Microsoft has also created several sites which assists in the sale of consumer based goods like used cars providing their price information and quality details (Lindgreen and Finn, 2005).
Internal and external Plan for Microsoft Corporation
Microsoft’s goals focus on different aspects of the organization’s management. Their planning basically focuses on impacting the four functions of management. The internal planning incorporates directions in the product processing, human resource management as well as efficient utilization of assets. These include good financial management, creation of conducive working environment to all employees.
On the other hand their external plan incorporates such issues as partnerships with other potential companies, political and legislative influences, technological innovations as well as environmental concerns. Partnerships and collaborations incorporate demographical changes within the workforce. The company plans to be accountable towards laws and at the same time offer equal opportunities to all its employees.
The Company tend to improve on the nature of their service delivery mechanisms and information set-up through new inventions. This would require radical change in the management team for the purposes of matching external competition on quality workforce.
Making the environment safe for habitation forms one of the top priorities for the company since they consider following strict legislative rules in the process of product and service distribution.
Conclusion
Microsoft utilizes public relations effectively since they use all the media channels including websites to provide necessary information to customers. The services are also provided locally through linkages with their main servers at cheaper and affordable prices. The use of company local sites in marketing has enabled consumers to quickly locate their various much needed products saving on time and money.
The company has expanded its services equally throughout the world within every region some of which include; North and South America, European Countries, Africa as well as Far East countries connected through internet.
Microsoft Corporation offers customers products within wholesale markets, there is also services available at retail options and structural efficiencies. The Company offers clients free listing services as well as intensive sales promotion services.
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