Houghton Miffline Harcourt Case Study Solution and Analysis
Intro
Houghton Miffline Harcourt Case Study Solution is the largest publishing business with a highest market share in the China's book retail market. CMP has ended up being a specialized info service provider and a big extensive Science and Innovation publishing company through the combination of print media, audio-visual media and the network media.
Vital Concerns
CMP has invested its 60 years journey efficiently, being an effective publishing home, nevertheless, the changing macro market trends and forces bring specific challenges to the publishing industry in general and Houghton Miffline Harcourt Case Study Solution in particular. These factors consist of;
• Entryway of the brand-new publishing firms in the market.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Enhancement of science and technology.
The change of the macro markets have raised a number of concerns to the management at CPM that what could be the future of CMP in this scenario? Do the long valuable experience, technical resources and the capabilities of the company could be made use of to pursue the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Houghton Miffline Harcourt Case Study Analysis has specific strengths that can be utilized to minimize the risks, conquer the weakness and avail the chances. Strengths of CMP are provided as follows;
• The long term experience of Houghton Miffline Harcourt Case Study Solution in the publishing industry i.e. 60 years permits the business to offer high quality items at a lower expense using its prior experiences.
• The technical resources and capabilities created by its effective journey offer a competitive advantage to CMP.
• Large product portfolioof CMP helps it to diversify its danger and supply high worth to its customers.
• Strong monetary position allows the company to think about several advancement chances with no fear of raising fund externally.
Weak points
Together with the strengths, the business has particular weak points which might increase restrictions for the business in executing its advancement program. The weak points of Houghton Miffline Harcourt Case Study Solution are provided as follows;
• Despite of being a science and technology publishing company, the company still has conventional ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It should propose specific expansion plans to prevent its dependence over the Chinese markets to accomplish long term growth.
Opportunities
Although, the development of the publishing market is declining given that 2008, impacting Houghton Miffline Harcourt Case Study Help too, however the development might be revived by availing certain chances provided in the market. The market chances for CMP include;
• The business could also present Digital Publishing by using its long term technical experience and a strong consumer acknowledgment in the market.
• CMP might think about an advancement program through the expansion towards foreign markets in order to reduce its reliance over Chinese markets by using its huge financial resources.
Dangers
The altering macro trends in the market and increasing competition in the publishing industry has actually positioned specific risks to Houghton Miffline Harcourt Case Study Analysis including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might cause decreasing market share of Houghton Miffline Harcourt Case Study Help due to the customer 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 rivals can get a strong customer base by utilizing certain methods like aggressive promo, quality items, etc.
• Entrance of brand-new publishing companies in the industry in addition to presence of high competitors increases the danger of losing the customer base.
Financial Analysis.
The business has a rather competitive monetary efficiency. Due to lack of data, the monetary ratios of CMP might not be computed. The general financial performance of the company might be evaluated by utilizing the charts provided in the case Appendices. It might be examined from the Appendix III that the annual total incomes of CMP during the duration 2000-2012 are growing at a high development rate, showing that the yearly need of the products of Houghton Miffline Harcourt Case Study Solution is growing and the business is quite effective in drawing in a large number of clients at a potential cost.
In addition to it, the 2nd graph which reveals the annual growth in the Houghton Miffline Harcourt Case Study Help overall assets, reveals that the company is quite efficient in adding worth to its possessions through its revenues. The development in possessions shows that the total worth of the company is likewise increasing with increasing the overall incomes. (Unidentified, 2013).
Another monetary analysis of the company utilizing the given data could be the analysis concerning the distribution of overall revenues of the business. Major part of the earnings of CMP comes from the sales of its released books i.e. 64% as shown in the Case Appendix V. The company could move towards other company sections with a possible growth to attain its future advancement goal.
PESTEL Analysis
PESTEL analysis could be conducted to discover the numerous external forces affecting the efficiency of the company and the recent patterns in the external environment of the business. A short PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a significant influence on the state of mind of individuals about the communist ideology of the federal government, therefore, the publishing sector is highly supervised and assisted by the Publicity Department of the Communist Party of China. For that reason, it could be said that the total political forces impacting Houghton Miffline Harcourt Case Study Help business are high. The government policies regarding the publishing sector are likewise increasing with the passage of time.
Affordable.
Economic forces impacting the publishing sector in basic and the Houghton Miffline Harcourt Case Study Help in particular includesthe rates of paper, the income level of consumers, the inflation rate, and the general GDP growth of the nation. All these forces integrate effect the need for the publishing market. Along with it, the financial policies connected to the import of books affect the overall service at CPM. However, China's financial conditions are rather favorable for CMP with high GDP development and consumer income level.
Social and Demographical.
Social and demographical forces consist of the population growth, the customer's choices towards reading useful materials and so on. China has the greatest population worldwide with a high population growth, revealing the increasing number of consumers of the Houghton Miffline Harcourt Case Study Help. The consumer preferences are moving towards digital publishing rather than the standard was of publishing. In this regard, CMP must concentrate on digital publishing to fulfill the altering customer preferences.
Technological.
Technological forces affecting the CMP consist of the technological improvement in the reading strategies and so on. Improvement of science and innovation along with the increase of digital publishing might reduce the demand for the CMP products, if specific actions would not be taken quickly.
Environmental.
Environmental forces affecting Houghton Miffline Harcourt Case Study Analysis includes the concerns of ecological neighborhoods over the use of paper in publishing books. The paper utilized in the books while publishing is needed to be non reusable and the ink used while publishing needs to not be damaging for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. The legal guidelines concerning the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be approved initially by the Federal government to be gone into in the publishing market. The ordinance forbids direct involvement of foreign entities and people in the publishing sector.
Industry Analysis (Porter's 5 Forces Model).
Porter's 5 Forces Model might be used to evaluate the beauty of the publishing market China. A quick analysis of the Porter's 5 Forces is given as follows;.
Risk of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Industry is moderate. The prospective growth in the industry tends to attract new entrants to the publishing market. The presence of extreme competitors and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the market.
Hazard of Replacement.
Hazard of Replacement is high for the Chinese Publishing Market. The replacement products for the published documents is the files presented in the virtual libraries on certain websites. The changing customer preferences towards digital learning increase the risk of replacement for the industry.
Competitive Rivalry.
Competitive rivalry in the publishing market is high. The existence of a great deal of customers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive competition for CMP. Together with it, brand-new entrants are likewise entering into the market increasing the competition for CMP.
Bargaining Power of Supplier.
The significant providers of the Houghton Miffline Harcourt Case Study Help include the suppliers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the general bargaining power of provider for CMP is low.
Bargaining Power of Buyer.
Bargaining power of buyer in the publishing industry is high. Due to the existence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality documents at competitive costs.
Rivals Analysis.
CMP operates in a highly competitive industry with the existence of large number of rivals. However, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Houghton Miffline Harcourt Case Study Solution consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis among the close rivals of CMP. Established in the exact same period, CIP releases comparable type of books. For a large period, CIP held the biggest market share, and still ranks 3rd and second in various market sections, with a major concentrate on instructional publications. CIP functions 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 could wean the market share of Houghton Miffline Harcourt Case Study Help easily in the current market situation.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise established in the exact same duration as CMP and CIP. It ranks 6th in the state-owned publishers in regards to organisation scale. It is also among the prominent players in the publishing market with a yearly overall incomes of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Reducing reliance over the Chinese markets.
• Increasing variety of Customers
• Growth chances.
• Avoiding the impact of market saturation in the Chinese publishing industry.
Cons
• Usage of prospective resources in growth.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce utilizing existing capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high worth to customers.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core company sectors 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 in addition to the industry analysis and the competitor analysis, Alternative 2 is suggested to CMP to attain its future advancement. As the preferences are moving towards digital publishing and the business require an instant option to prevent the decreasing market development. Therefore, intro of digital publishing could show to be an immediate solution with low quantity of threat for the company. The business could also consider the growth program after the success of its digital publishing program.
Application
In order to present digital publishing in its item portfolio, the company needs to initially gathers the data associated with the customer demand, the possible markets, the federal government regulations and the data related to the rivals presented in the market. After that, the company ought to choose one potential section for its initial offering. It must gather research study that how it could separate its digital publishing from the existing rivals' products. After all the steps above the business ought to choose the preliminary offering. The business should go for the other markets if the initial offering shows a success. In this method the business would be able to implement its digital publishing program.
Conclusion
Although, the growth of the publishing industry is decreasing because 2008, showing a danger to the business's long term existence, however the circumstance can be managed by considering an advancement strategy in the future. The company might consider introducing digital publishingin its existing market to implement its advancement program at instant basis and to avoid the risk of failure for entrance in the brand-new markets.
