Internal Controls Internal Audit Risk Management And Compliance Case Study Solution and Analysis
Internal Controls Internal Audit Risk Management And Compliance Case Study Analysis is the largest publishing company with a highest market share in the China's book retail market. CMP has actually ended up being a specialized information service provider and a big detailed Science and Technology publishing company through the integration of print media, audio-visual media and the network media.
CMP has spent its 60 years journey efficiently, being a successful publishing house, however, the changing macro market patterns and forces bring particular difficulties to the publishing market in basic and Internal Controls Internal Audit Risk Management And Compliance Case Study Solution in particular. These aspects include;
• Entrance of the new publishing companies in the market.
• Decreasing growth 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 concerns to the management at CPM that what could be the future of CMP in this circumstance? Do the long valuable experience, technical resources and the capabilities of the company could be made use of to strive for the future development unceasingly? How could the business sustain its long term competitive position in future?
Internal Controls Internal Audit Risk Management And Compliance Case Study Solution has specific strengths that can be made use of to decrease the risks, overcome the weakness and obtain the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Internal Controls Internal Audit Risk Management And Compliance Case Study Analysis in the publishing industry i.e. 60 years allows the business to supply high quality products at a lower cost using its previous experiences.
• The technical resources and abilities produced by its successful journey offer a competitive advantage to CMP.
• Vast product portfolioof CMP assists it to diversify its threat and provide high value to its clients.
• Strong financial position enables the company to consider a number of advancement chances with no worry of raising fund externally.
Along with the strengths, the company has particular weaknesses which could increase restraints for the company in executing its development program. The weak points of Internal Controls Internal Audit Risk Management And Compliance Case Study Help are given as follows;
• Despite of being a science and innovation publishing firm, the business still has conventional ways ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It must propose certain growth strategies to prevent its dependence over the Chinese markets to achieve long term development.
Although, the development of the publishing industry is decreasing because 2008, affecting Internal Controls Internal Audit Risk Management And Compliance Case Study Help too, but the development could be revived by availing certain opportunities presented in the market. The marketplace chances for CMP consist of;
• The company could likewise introduce Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP could consider an advancement program through the expansion towards foreign markets in order to lower its dependence over Chinese markets by using its vast funds.
The altering macro patterns in the market and increasing competitors in the publishing industry has posed certain hazards to Internal Controls Internal Audit Risk Management And Compliance Case Study Solution including;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries could cause decreasing market share of Internal Controls Internal Audit Risk Management And Compliance Case Study Help due to the customer shift towards virtual libraries.
• The presence of a great deal of competitors in the publishing market increase the danger for CMP to lose its competitive position in the market, as competitors can acquire a strong customer base by utilizing certain methods like aggressive promotion, quality products, etc.
• Entrance of new publishing companies in the market along with presence of high competition increases the risk of losing the client base.
Due to absence of data, the financial ratios of CMP might not be determined. It could be evaluated from the Appendix III that the annual overall earnings of Internal Controls Internal Audit Risk Management And Compliance Case Study Analysis throughout the period 2000-2012 are growing at a high growth rate, revealing that the annual demand of the items of CMP is growing and the company is quite efficient in attracting a big number of consumers at a potential price.
Along with it, the second graph which reveals the yearly growth in the Internal Controls Internal Audit Risk Management And Compliance Case Study Help total properties, reveals that the company is quite effective in adding worth to its properties through its earnings. The growth in properties shows that the total value of the company is likewise increasing with increasing the overall revenues. (Unknown, 2013).
Another financial analysis of the business using the given information could be the analysis relating to the distribution of overall earnings of the company. Major part of the earnings of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The company could move towards other organisation sections with a potential development to achieve its future development objective.
PESTEL analysis could be carried out to learn the various external forces affecting the efficiency of the business and the recent patterns in the external environment of the business. A quick PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
As the publishing sector could have a substantial impact on the mindset of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly supervised and assisted by the Promotion Department of the Communist Celebration of China. For that reason, it might be stated that the total political forces impacting Internal Controls Internal Audit Risk Management And Compliance Case Study Solution organisation are high. The government policies relating to the publishing sector are likewise increasing with the passage of time.
Financial forces impacting the publishing sector in basic and the CMP in specific includesthe prices of paper, the income level of customers, the inflation rate, and the general GDP development of the nation. All these forces integrate effect the demand for the publishing market.
Social and Demographical.
The customer preferences are moving towards digital publishing rather than the conventional was of publishing. In this regard, CMP should focus on digital publishing to meet the changing consumer choices.
Technological forces affecting the CMP include the technological improvement in the reading methods etc. Improvement of science and innovation in addition to the increase of digital publishing might lower the need for the CMP items, if particular actions would not be taken quickly.
Ecological forces impacting Internal Controls Internal Audit Risk Management And Compliance Case Study Solution consists of the issues of ecological communities over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink utilized while publishing ought to not be harmful for the environment.
Legal guidelines for the publishing sector at whole are high. Publishing Regulation 1997 requires the publishers to be authorized first by the Government to be gone into in the publishing market.
Industry Analysis (Porter's 5 Forces Model).
Porter's Five Forces Design might be used to evaluate the beauty of the publishing market China. A short analysis of the Porter's Five Forces is given as follows;.
Threat of New Entrants.
Hazards of new entrants in the Chinese Publishing Industry is moderate. The potential development in the market tends to bring in new entrants to the publishing industry. Nevertheless, the existence of extreme competitors and the requirement of big capital tends to demotivate new entrants to go into in the market.
Danger of Alternative.
Threat of Replacement is high for the Chinese Publishing Market. The replacement items for the published files is the documents provided in the digital libraries on specific websites. The altering consumer preferences towards digital knowing increase the hazard of replacement for the market.
Competitive competition 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 rivalry for CMP. Together with it, new entrants are also entering into the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The major suppliers of the Internal Controls Internal Audit Risk Management And Compliance Case Study Analysis consist of the suppliers of the paper for releasing files. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the overall bargaining power of provider for CMP is low.
Bargaining Power of Buyer.
Bargaining power of purchaser 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 prices.
CMP operates in an extremely competitive market with the existence of large number of rivals. The company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of Internal Controls Internal Audit Risk Management And Compliance Case Study Solution consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis among the close rivals of CMP. Founded in the very same duration, CIP releases comparable kind of books. For a big period, CIP held the largest market share, and still ranks 2nd and third in various market sections, with a significant concentrate on educational publications. CIP serves as a risk for CMP as it could wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and might wean the market share of Internal Controls Internal Audit Risk Management And Compliance Case Study Solution easily in the existing market circumstance.
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 sixth in the state-owned publishers in regards to company scale. It is likewise among the prominent gamers in the publishing market with a yearly overall incomes of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Minimizing reliance over the Chinese markets.
• Increasing variety of Consumers
• Growth opportunities.
• Avoiding the impact of market saturation in the Chinese publishing industry.
• Usage of potential resources in expansion.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to present using existing capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high value to clients.
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core service sections to the new one can lead the company to lose need of its products in the market.
As the preferences are shifting towards digital publishing and the business need an instant option to prevent the decreasing market growth. The business could also consider the growth program after the success of its digital publishing program.
In order to introduce digital publishing in its product portfolio, the business should initially gathers the information related to the consumer need, the possible markets, the federal government regulations and the data related to the competitors provided in the market. If the initial offering proves a success, the company must go for the other markets. In this way the business would be able to execute its digital publishing program.
Although, the development of the publishing market is declining since 2008, showing a danger to the company's long term presence, however the scenario can be controlled by considering a development strategy in the future. The company could think about introducing digital publishingin its existing market to execute its development program at immediate basis and to avoid the threat of failure for entryway in the new markets.