European Leadership Case Study Solution and Analysis
Introduction
European Leadership Case Study Solution is the biggest publishing company with a greatest market share in the China's book retail market. CMP has become a specialized info provider and a big detailed Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Crucial Issues
CMP has actually invested its 60 years journey smoothly, being a successful publishing home, however, the altering macro market patterns and forces bring specific challenges to the publishing industry in general and European Leadership Case Study Solution in particular. These factors consist of;
• Entryway of the brand-new publishing companies in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Enhancement of science and technology.
The transformation of the macro markets have raised a number of questions to the management at CPM that what could be the future of CMP in this situation? Do the long valuable experience, technical resources and the abilities of the business could be utilized to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
European Leadership Case Study Analysis has certain strengths that can be utilized to lower the risks, overcome the weak point and avail the chances. Strengths of CMP are provided as follows;
• The long term experience of European Leadership Case Study Analysis in the publishing industry i.e. 60 years enables the business to offer high quality items at a lower cost using its previous experiences.
• The technical resources and abilities produced by its effective journey offer a competitive benefit to CMP.
• Large product portfolioof CMP helps it to diversify its threat and provide high value to its customers.
• Strong monetary position allows the company to think about numerous development opportunities without any worry of raising fund externally.
Weaknesses
In addition to the strengths, the business has certain weak points which could increase restraints for the company in implementing its development program. The weak points of European Leadership Case Study Analysis are provided as follows;
• Despite of being a science and innovation publishing company, the business still has traditional methods ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It should propose certain growth plans to prevent its dependence over the Chinese markets to accomplish long term development.
Opportunities
Although, the development of the publishing market is declining given that 2008, affecting European Leadership Case Study Solution too, however the growth could be revived by availing specific opportunities provided in the market. The marketplace opportunities for CMP consist of;
• The business could likewise present Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP might consider a development program through the growth towards foreign markets in order to decrease its reliance over Chinese markets by utilizing its huge funds.
Dangers
The changing macro trends in the market and increasing competitors in the publishing market has actually posed specific risks to European Leadership Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could result in decreasing market share of European Leadership Case Study Help due to the consumer shift towards virtual 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 competitors can gain a strong customer base by utilizing specific techniques like aggressive promo, quality items, etc.
• Entrance of brand-new publishing firms in the industry along with existence of high competitors increases the risk of losing the customer base.
Monetary Analysis.
The business has a quite competitive monetary performance. Due to absence of data, the financial ratios of CMP could not be computed. Nevertheless, the general financial performance of the business might be analyzed by utilizing the graphs given in the case Appendices. It could be evaluated from the Appendix III that the annual total incomes of CMP during the duration 2000-2012 are growing at a high growth rate, revealing that the yearly demand of the products of European Leadership Case Study Solution is growing and the company is quite efficient in drawing in a a great deal of clients at a prospective cost.
In addition to it, the 2nd chart which reveals the yearly development in the European Leadership Case Study Help overall assets, shows that the business is quite effective in including value to its properties through its earnings. The growth in properties reveals that the overall worth of the firm is also increasing with increasing the overall revenues. (Unknown, 2013).
Another financial analysis of the company utilizing the given data might be the analysis regarding the distribution of total earnings of the company. Major part of the incomes of CMP comes from the sales of its published books i.e. 64% as shown in the Case Appendix V. The business could move towards other company sectors with a possible development to achieve its future development goal.
PESTEL Analysis
PESTEL analysis could be carried out to learn the different external forces affecting the performance of the business and the recent trends in the external environment of the company. A quick PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable influence on the frame of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is extremely supervised and assisted by the Publicity Department of the Communist Celebration of China. It might be stated that the overall political forces affecting CMP service are high. The federal government policies concerning the publishing sector are likewise increasing with the passage of time.
Affordable.
Financial forces impacting the publishing sector in general and the CMP in particular includesthe costs of paper, the income level of customers, the inflation rate, and the overall 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 standard was of publishing. In this regard, CMP needs to focus on digital publishing to meet the altering consumer preferences.
Technological.
Technological forces affecting the CMP consist of the technological advancement in the reading techniques etc. Enhancement of science and innovation along with the rise of digital publishing might decrease the need for the CMP items, if specific actions would not be taken soon.
Environmental.
Ecological forces affecting European Leadership Case Study Solution consists of the concerns of ecological neighborhoods over the usage of paper in publishing books. The paper used in the books while publishing is needed to be disposable and the ink used while publishing ought to not be damaging for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be approved initially by the Federal government to be entered in the publishing market.
Market Analysis (Porter's 5 Forces Model).
Porter's Five Forces Model could be used to analyze the attractiveness of the publishing market China. A short analysis of the Porter's Five Forces is offered as follows;.
Danger of New Entrants.
Risks of brand-new entrants in the Chinese Publishing Industry is moderate. The prospective growth in the market tends to bring in brand-new entrants to the publishing market. The existence of intense competition and the requirement of big capital tends to demotivate brand-new entrants to enter in the market.
Hazard of Substitution.
Threat of Substitution is high for the Chinese Publishing Market. The replacement products for the released documents is the files presented in the digital libraries on particular websites. The changing consumer choices towards digital learning increase the risk of substitution for the market.
Competitive Rivalry.
Competitive competition in the publishing industry is high. The existence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. In addition to it, new entrants are also entering into the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The major providers of the European Leadership Case Study Help consist of the providers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of buyer in the publishing market is high. Due to the existence of a large number of publishers in the Chinese market and the market saturation, the purchasers needs high quality files at competitive costs.
Competitors Analysis.
CMP runs in an extremely competitive market with the presence of a great deal of competitors. Nevertheless, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant rivals of European Leadership Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis one of the close rivals of CMP. Founded in the exact same period, CIP publishes similar kind of books. For a large period, CIP held the biggest market share, and still ranks third and second in different market sectors, with a major concentrate on educational publications. CIP serves 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 marketplace share of European Leadership Case Study Solution easily in the current market circumstance.
Posts and telecommunication Press (PTP).
It was likewise founded in the same duration as European Leadership Case Study Solution and CIP. It is also one of the prominent players in the publishing market with a yearly total profits of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Reducing reliance over the Chinese markets.
• Increasing number of Customers
• Growth chances.
• Avoiding the impact of market saturation in the Chinese publishing industry.
Cons
• Use of prospective resources in growth.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to present utilizing present abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high value to consumers.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core service segments to the new one can lead the business to lose demand of its products in the market.
Recommendations
With the deep analysis of the external and internal environment of the company along with the market analysis and the rival analysis, Alternative 2 is advised to CMP to achieve its future advancement. As the choices are shifting towards digital publishing and the company require an immediate service to avoid the declining market growth. Introduction of digital publishing could prove to be an instant solution with low quantity of threat for the business. The company could also consider the growth program after the success of its digital publishing program.
Application
In order to introduce digital publishing in its product portfolio, the company should initially collects the information related to the customer need, the prospective markets, the federal government guidelines and the information related to the competitors provided in the market. If the preliminary offering proves a success, the company should go for the other markets. In this way the business would be able to execute its digital publishing program.
Conclusion
The growth of the publishing market is declining since 2008, revealing a risk to the business's long term existence, but the circumstance can be controlled by considering a development plan in the future. The business could think about introducing digital publishingin its existing market to execute its development program at instant basis and to avoid the threat of failure for entryway in the brand-new markets.
