Businesses are meant to expand in the future. However, it is important for the businesses to decide upon the strategies that will focus upon the expansion plan. The businesses can be related to any industry. However, due to globalization and increased consumer demands, the organizations are planning to expand in the abroad countries as well.
We have often observed that, the organization will be initially serving to one category of people. They have segmented their target market, and hence, are not able to serve to all the different segments of the society. But, with the passage of time, the organization grows and slowly focuses upon the expansion strategies. But, before expansion strategies, they need to determine the needs of the different segments of the society. The thesis of this paper shall describe the various ways in which business organizations can grow and expand. We shall also be including examples of the organizations, which have focused upon business expansion strategies. In addition, we shall evaluate the potential benefits and pitfalls associated with it.
For any organization, before going for the expansion, needs to carry out a deep intensive market research in order to determine the needs of the end customers. They need to review their opinions, views, and expectations from the respective products or services. It will help the organization to design a product or service, which will cater to the needs of these customers. The organization can further decide upon, whether to go for the horizontal expansion or vertical expansion strategy to cater to the needs of the organization as well as support the growth factors of the organization. Horizontal market refers to a specific market segment or component within a particular business industry. It refers to a particular business model that is limited with its scope of application. A vertical market refers to a generalized business model that involves a particular business industry and all of its segments. Vertical market has a broad business model that can address the productivity, revenue generation and other marketing aspects on a larger canvas of business intelligence role (Buchanan).
The horizontal market entity that is under our study is Microsoft Corporation. We observe that Microsoft was the topmost company growing in the field of Computer Industry back in 1990s and now-a-days we still do hear its name in the global canvas of business entities. Microsoft has merged with some of the rapidly growing companies such as Skype to survive and compete with the other fast growing competitors.
The vertical company that we have considered is Google that has not merged with any of its competitors. In fact, it's hard to find a competitor of Google now-a-days. The successful journey of Google has been started around 10 to 12 years back. It has no doubt, become number one search engine optimization platform that is considered as most reliable content distribution and management system at the global level. Not only, Goggle has been number one in the search engine optimization field, but it has grown to the top-level amongst all other Internet marketing agencies (Skillicorn).
Microsoft listens to the consumers and accordingly develops products on the basis of their feedback received from the consumers. Google product strategy model involves combinations of Innovation and Commodities. Google tried to follow slightly the Apple's product strategy model. It involves competent and innovative experts. Google thinks on the generation of a unique idea and develops it in a careful and innovative manner, which can thereby address the need of consumers (Mattera).
Google also seems to land to the secret island of mysteries, i.e. they secretly develop products and then give it a big launch. Google also tried to utilize the experience of Microsoft of utilization of consumer's feedback in the course of development. We can thus conclude that, Google seems to follow the smartest approach of getting familiar with the product development strategy models used by other top-brand organizations in the field of Internet and other IT specific services. It has thus, expanded across the globe and almost across all the nations of the world.
There are many differences in the business development and organizational approach between both Google and Microsoft, from the expansion perspective. Google focuses to move on an open source model of development. Their expansion strategy is based upon taking up challenges by saying 'yes, we will do this.’ Google focuses on work, work and work. Microsoft, on the other hand, relies on a conventional organizational model in which hierarchy of professionals or managers decide the course and flow of work. However, in order to compete and elevate again as it was in the 1990s era, the middle-level management of Microsoft need to focus upon the culture of saying 'yes' and taking up the challenges.
Google has not integrated any other businesses within it. The core competency for Google has remained the Search Engine platform and the associated search engine optimization techniques (Coltman, Devinney, & Midgley 87-101). Google did not require any other products or services for expanding itself into other nations. On the other hand, Microsoft focused on developing new products and services, so as to expand them in other nations.
Google integrates the user’s information along with its products and tries to market them accordingly. Consider, for example, people do have Google Mail Accounts. They have provided all their personal information and hence, it becomes easy for Google to market their products. Secondly, Google tracks down the behavior on the basis of the clicks made by the user and the sites the customer has visited.
Google accordingly, provides the list of web pages and addresses of websites that will fulfill the needs of the respective user. Thus, the strategies are more of virtual in nature. In addition, it is observed that, Google has made tie-ups with every such organization that wants to sell their products using the Google Platform. So, on the basis of the behavior, needs, requirements, and personal perception, Google markets the products to its users.
On the other hand, Microsoft has a different strategy for expanding itself since there are several products available with the organization. Microsoft provides initially with a licensed copy of the Operating System to all the users of the Windows Operating System. In addition, the other products of Microsoft such as Microsoft Office are provided with a trial version. However, even if the trial version expires, people can still use it. However, with other competitive products, we do need to buy the licensed products and only then, we can continue using it. Microsoft is thus, making people addicted to using the Windows Operating System. People are now already so much used to it that they always prefer Microsoft’s Products. Microsoft is now getting into several other businesses, and with such large customer base, it becomes easy for them to market all their products.
Google is seen as an empire with no boundaries and limits. It's accessible anywhere and anytime. A lot of extensive research is going on in the business schools and colleges to understand the mechanism and the business model that Google has introduced to the world (Rottman 31-43). It has expanded virtually to every part of the world. On the other hand, Microsoft has been in the competition right from the beginning. But, its role seems to be conventional and more of just relying on the feedback. The expansion strategies have focused more on developing new products, rather than understanding the needs of the customers.
It is important for the organizations to focus upon job enrichment and job enlargement issues. With the increase in the number of locations, the organization will be required to improve the HR functioning so as to address these issues effectively. In the discussed case, we saw that, both the organizations have, however, tried to focus upon the expansion strategies in their ways. And, for any other organization, they can similarly focus upon strategies to expand horizontally or vertically or through mergers or acquisitions. There are organizations that have acquired other small organizations, and have thus, tried to expand in the foreign lands. But, it is not always necessary to become successful through such expansion strategies. It is more important to carry out market research, and then understand the needs of the customers. It will better help a given organization to expand in either domestic or international territories.
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Rottman, J W. "Successful knowledge transfer within offshore supplier networks: a case study exploring social capital in strategic alliances." Journal of Information Technology 23 (2008): 31-43. Doi:10.1057/palgrave.jit.2000127.
Coltman, T R, T Devinney, and D Midgley. "e-Business strategy and firm performance: a latent class assessment of the drivers and impediments to success." Journal of Information Technology 22 (2007): 87-101. Doi:10.1057/palgrave.jit.2000073.
Mattera, Sam. "Will Microsoft Copy the Tablet Strategies of Apple and Google?" The Motley Fool. 30 Nov. 2013. Web. 15 Oct. 2014.
Skillicorn, Nicholas. "Microsoft out-innovates Apple & Google." Innovation Excellence. 11 Apr. 2014. Web. 15 Oct. 2014. <http://www.innovationexcellence.com/blog/2014/04/11/microsoft-out-innovates-apple-google/>.