1. Description of the Business Opportunity
Microsoft Corporation is a company that develops different software product among other services in the ICT industry. The company designs hardware and performs online advertising services. The broad suite of services provided by Microsoft enables the company to have a high customer base. The company has cross selling opportunities that impact positively on the revenue and the profit margins. The company has a robust financial performance managed to grow by 5.6 percent to $77,849 million in FY2013 (Microsoft Corporation, 2014). The operating and the net profits have grown by 23 percent and 28 percent to & 26,764 million and $21,863 million (Pittel, 2013). The company has agreed to acquire most of the Nokia devices worth $7.2 billion. In the acquisition, Microsoft will license all Nokia patents. The global shipment of smartphones reached 959 million units in FY2113 from 722 million units in FY2012 (Bhanji, 2013). The company experiences a demand for tablets that can reach 410 million units by 2017. The strategic acquisition of Nokia devices will enhance the firm’s portfolio and the geographic footprint in the emerging markets to enhance the future revenue of the company. The company has a high focus on research and development. Microsoft commits most of its resources to develop new solutions in hardware and software. At least 37,000 associates engage in research and development related activities. The company’s R & D expenditure is as follows $9 billion, $9.8 billion, and $10.4 billion in FY2011, FY2012, and FY2013 respectively (Microsoft Corporation, 2014). The firm’s strong R&D investment enables it to add the patents since it has 35,000 issued patents and 38,000 pending patents. The patents will enable the company to launch new solutions. According to Bhanji (2013), technology advancements and well trained personnel in the firm will affect the production in the ICT industry.
2. Purpose of the Investigation
Microsoft Corporation has the ability of increasing the cloud computing services in the coming years. A cloud computing infrastructure model will assist the firm to deliver software-as-a-service (SaaS). Cloud computing will enable the firm to reduce the expenses on royalty and licenses. The firm expects the demand for cloud computing to shift from $47.4 billion in 2014 to $107 billion in 2017 (Microsoft Corporation, 2014). The growth of public cloud services leads to the emergence of virtual private cloud offerings. Microsoft has several benefits to uplift growth in cloud offerings such as Windows Azure and Office 365. The purpose of this investigation is to identify the feasibility of adopting cloud computing services in future (Bhanji, 2013).
3. Management/ Business Questions
Microsoft has been able to reign supreme in the software industry due to the use of superior marketing and research and strategic partnership with large hardware firms in the production of personal computers. Some of the primary competitions of Microsoft in the market include Google, Oracle, VMware, IBM and Apple (Pittel, 2013). Microsoft uses intangible capital as a source of company growth to devote effect of technical change on the economic growth. The company’s source of growth includes investments in product research and development and general organizational development. An empirical analysis provides a skewed model to support neoclassical growth in the accounting framework. The Windows 2008 server product serves a hardware running on the ITS platform (Microsoft Corporation, 2014). Additionally, the server product serves a multi-user functionality in the standard and office applications.
4. Intended Audience: customers are vital stakeholders in Microsoft Corporation since they drive force of sales and revenue generation. Organization must provide high quality and affordable prices.
5. Summary of Section Highlights
Microsoft Corporation integrated offerings will enable the company to provide end-to-end solutions and high value customer base. The company provides significant cross selling opportunities. The decline in Personal Computer market is likely to have an impact in the demand for PCs in the firm to lower the revenue and the profit margins.
Bhanji, Z. (2013). Transnational Private Authority in Education Policy in Jordan and South Africa: The Case of Microsoft Corporation. Comparative Education Review, 56(2), 300-319.
Microsoft Corporation SWOT Analysis. (2014). Microsoft Corporation SWOT Analysis, 1-9.
Pittel, S. (2013). The 2010 Bower Award for Business Leadership presented to William H. Gates III, Microsoft Corporation. Journal of The Franklin Institute, ISSN 0016-0032. Retrieved October 16, 2013, from http://dx.doi.org/10.1016/j.jfranklin.2012.07.008