Ecco As Global Value Chain Management 6 Case Study Solution and Analysis
Introduction
Ecco As Global Value Chain Management 6 Case Study Solution is the biggest publishing company with a highest market share in the China's book retail market. CMP has actually become a specialized info service provider and a big extensive Science and Technology publishing company through the combination of print media, audio-visual media and the network media.
Important Concerns
Although, Ecco As Global Value Chain Management 6 Case Study Solution has spent its 60 years journey efficiently, being a successful publishing home, however, the changing macro market trends and forces bring certain difficulties to the publishing market in general and CMP in particular. These elements include;
• Entrance of the brand-new publishing companies in the market.
• Declining growth of the publishing market.
• Market saturation.
• Introduction of digital publishing methods
• Enhancement of science and technology.
The improvement of the macro markets have raised several concerns to the management at CPM that what could be the future of CMP in this scenario? Do the long important experience, technical resources and the abilities of the company could be used to pursue the future development unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Ecco As Global Value Chain Management 6 Case Study Solution has specific strengths that can be utilized to minimize the threats, get rid of the weakness and avail the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Ecco As Global Value Chain Management 6 Case Study Analysis in the publishing industry i.e. 60 years enables the business to offer high quality items at a lower cost utilizing its previous experiences.
• The technical resources and abilities produced by its successful journey provide a competitive benefit to CMP.
• Large product portfolioof CMP assists it to diversify its threat and provide high value to its clients.
• Strong monetary position allows the company to consider a number of advancement opportunities without any fear of raising fund externally.
Weak points
In addition to the strengths, the business has particular weaknesses which could increase restrictions for the company in implementing its development program. The weaknesses of Ecco As Global Value Chain Management 6 Case Study Help are provided as follows;
• Despite of being a science and innovation publishing company, the company still has traditional ways ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It ought to propose particular growth strategies to prevent its reliance over the Chinese markets to achieve long term growth.
Opportunities
Although, the development of the publishing industry is decreasing since 2008, impacting Ecco As Global Value Chain Management 6 Case Study Analysis too, but the growth could be revived by availing particular opportunities presented in the market. The marketplace chances for CMP consist of;
• The business might likewise introduce Digital Publishing by utilizing its long term technical experience and a strong client recognition in the market.
• CMP could consider a development program through the expansion towards foreign markets in order to reduce its reliance over Chinese markets by utilizing its huge funds.
Hazards
The changing macro trends in the market and increasing competition in the publishing market has actually presented particular hazards to Ecco As Global Value Chain Management 6 Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries might cause decreasing market share of Ecco As Global Value Chain Management 6 Case Study Help due to the customer shift towards digital libraries.
• The existence of large number of rivals in the publishing industry increase the hazard for CMP to lose its competitive position in the market, as rivals can acquire a strong customer base by utilizing certain strategies like aggressive promotion, quality products, and so on
• Entryway of new publishing companies in the industry together with existence of high competitors increases the danger of losing the customer base.
Monetary Analysis.
Due to absence of information, the monetary ratios of CMP might not be determined. It could be evaluated from the Appendix III that the annual overall incomes of Ecco As Global Value Chain Management 6 Case Study Solution throughout the period 2000-2012 are growing at a high development rate, showing that the yearly need of the items of CMP is growing and the business is rather effective in drawing in a large number of clients at a potential price.
In addition to it, the second chart which shows the yearly development in the Ecco As Global Value Chain Management 6 Case Study Help overall properties, reveals that the company is rather effective in adding value to its assets through its revenues. The development in possessions shows that the total worth of the company is also increasing with increasing the total earnings. (Unidentified, 2013).
Another financial analysis of the company utilizing the offered data could be the analysis concerning the distribution of total revenues of the business. Huge part of the earnings of CMP comes from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The company might move towards other company sections with a possible development to achieve its future advancement goal.
PESTEL Analysis
PESTEL analysis might be conducted to find out the different external forces affecting the performance of the company and the current patterns in the external environment of the business. A short PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable impact on the mindset of individuals about the communist ideology of the government, therefore, the publishing sector is highly supervised and directed by the Promotion Department of the Communist Party of China. It could be said that the overall political forces affecting CMP company are high. The government policies concerning the publishing sector are also increasing with the passage of time.
Cost-effective.
Financial forces affecting the publishing sector in general and the CMP in specific includesthe rates of paper, the earnings level of customers, the inflation rate, and the general GDP growth of the country. All these forces integrate impact the demand for the publishing market.
Social and Demographical.
The customer preferences are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP should focus on digital publishing to satisfy the altering customer preferences.
Technological.
Technological forces affecting the CMP consist of the technological advancement in the reading techniques and so on. Improvement of science and technology along with the increase of digital publishing could lower the demand for the CMP products, if specific actions would not be taken quickly.
Environmental.
Ecological forces affecting Ecco As Global Value Chain Management 6 Case Study Help consists of the concerns of ecological neighborhoods over the use of paper in publishing books. The paper utilized in the books while publishing is required to be non reusable and the ink utilized while publishing ought to not be damaging for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be approved initially by the Government to be gone into in the publishing market.
Market Analysis (Porter's 5 Forces Design).
Porter's Five Forces Model could be used to examine the beauty of the publishing market China. A quick analysis of the Porter's Five Forces is provided as follows;.
Threat of New Entrants.
Risks of new entrants in the Chinese Publishing Market is moderate. The potential development in the industry tends to draw in new entrants to the publishing market. The presence of intense competition and the requirement of substantial capital tends to demotivate new entrants to go into in the market.
Threat of Substitution.
Hazard of Substitution is high for the Chinese Publishing Industry. The substitute products for the released documents is the documents presented in the digital libraries on specific websites. The altering customer choices towards digital learning increase the danger of alternative for the industry.
Competitive Rivalry.
Competitive competition in the publishing market is high. The existence of large number of consumers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive competition for CMP. Along with it, new entrants are likewise participating in the market increasing the competition for CMP.
Bargaining Power of Provider.
The significant providers of the Ecco As Global Value Chain Management 6 Case Study Analysis consist of the suppliers of the paper for publishing documents. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the total bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of purchaser in the publishing industry is high. Due to the existence of a a great deal of publishers in the Chinese market and the marketplace saturation, the purchasers requires high quality documents at competitive costs.
Rivals Analysis.
CMP operates in a highly competitive industry with the existence of large number of competitors. The business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of Ecco As Global Value Chain Management 6 Case Study Analysis consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a threat for CMP as it could wean its market share due to its long term competitive background. CIP is focused on digital publishing and might wean the market share of CMP easily in the current market scenario.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise established in the very same period as CMP and CIP. It ranks sixth in the state-owned publishers in terms of service scale. It is likewise one of the popular players in the publishing market with an annual total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Minimizing dependence over the Chinese markets.
• Increasing variety of Clients
• Development chances.
• Avoiding the effect of market saturation in the Chinese publishing industry.
Cons
• Usage of prospective resources in expansion.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce utilizing present abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio provides high value to customers.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company segments to the brand-new one can lead the business to lose demand of its items in the market.
Recommendations
As the preferences are shifting towards digital publishing and the business need an immediate solution to avoid the decreasing market growth. The company might also consider the expansion program after the success of its digital publishing program.
Implementation
In order to present digital publishing in its item portfolio, the business should first gathers the data related to the consumer need, the possible markets, the federal government regulations and the information related to the competitors provided in the market. If the initial offering shows a success, the business should go for the other markets. In this way the business would be able to implement its digital publishing program.
Conclusion
The development of the publishing industry is declining because 2008, showing a risk to the company's long term presence, but the situation can be managed by thinking about a development strategy in the future. The business might consider presenting digital publishingin its existing market to implement its development program at immediate basis and to avoid the threat of failure for entrance in the new markets.
