Logitech Finding Success Through Innovation And Acquisition Case Study Solution and Analysis
Introduction
Logitech Finding Success Through Innovation And Acquisition Case Study Analysis is the largest publishing company with a highest market share in the China's book retail market. CMP has actually become a specialized information supplier and a large detailed Science and Innovation publishing company through the combination of print media, audio-visual media and the network media.
Critical Problems
Although, Logitech Finding Success Through Innovation And Acquisition Case Study Help has spent its 60 years journey efficiently, being an effective publishing house, nevertheless, the altering macro market trends and forces bring certain difficulties to the publishing market in general and CMP in particular. These elements include;
• Entrance of the new publishing firms in the industry.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Improvement 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 business could be utilized to strive for the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Logitech Finding Success Through Innovation And Acquisition Case Study Help has particular strengths that can be made use of to decrease the risks, overcome the weakness and get the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Logitech Finding Success Through Innovation And Acquisition Case Study Help in the publishing market i.e. 60 years permits the business to supply high quality products at a lower cost utilizing its previous experiences.
• The technical resources and abilities produced by its effective journey supply a competitive benefit to CMP.
• Vast product portfolioof CMP helps it to diversify its danger and offer high worth to its clients.
• Strong monetary position enables the company to think about several advancement opportunities with no worry of raising fund externally.
Weaknesses
Along with the strengths, the business has certain weak points which might increase restraints for the company in executing its advancement program. The weaknesses of Logitech Finding Success Through Innovation And Acquisition Case Study Analysis are given as follows;
• Despite of being a science and technology publishing firm, the business still has traditional methods ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It must propose particular growth plans to prevent its reliance over the Chinese markets to achieve long term development.
Opportunities
The development of the publishing industry is declining considering that 2008, impacting Logitech Finding Success Through Innovation And Acquisition Case Study Solution as well, but the development could be revived by availing specific opportunities provided in the market. The market chances for CMP include;
• The business could likewise present Digital Publishing by using its long term technical experience and a strong customer recognition in the market.
• CMP might consider a development program through the growth towards foreign markets in order to lower its dependence over Chinese markets by using its large funds.
Dangers
The changing macro patterns in the market and increasing competitors in the publishing industry has posed particular hazards to Logitech Finding Success Through Innovation And Acquisition Case Study Solution including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could cause declining market share of Logitech Finding Success Through Innovation And Acquisition Case Study Solution due to the consumer shift towards virtual libraries.
• The presence of large number of competitors in the publishing market increase the danger for CMP to lose its competitive position in the market, as competitors can gain a strong consumer base by using specific strategies like aggressive promotion, quality products, and so on
• Entrance of new publishing companies in the industry together with presence of high competitors increases the danger of losing the consumer base.
Financial Analysis.
Due to absence of data, the financial ratios of CMP could not be determined. It might be evaluated from the Appendix III that the annual total incomes of Logitech Finding Success Through Innovation And Acquisition Case Study Analysis during the duration 2000-2012 are growing at a high growth rate, revealing that the annual need of the items of CMP is growing and the business is quite efficient in bring in a large number of consumers at a potential cost.
In addition to it, the 2nd graph which shows the annual growth in the Logitech Finding Success Through Innovation And Acquisition Case Study Help overall assets, shows that the company is rather effective in adding value to its possessions through its earnings. The development in assets shows that the total value of the company is also increasing with increasing the total profits. (Unidentified, 2013).
Another financial analysis of the company utilizing the offered data might be the analysis regarding the circulation of total profits of the company. Huge part of the revenues of CMP originates from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The company might move towards other business sections with a prospective development to achieve its future advancement goal.
PESTEL Analysis
PESTEL analysis might be conducted to learn the different external forces affecting the performance of the company and the current 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 significant effect on the state of mind of individuals about the communist ideology of the federal government, therefore, the publishing sector is extremely monitored and guided by the Publicity Department of the Communist Party of China. Therefore, it could be said that the overall political forces affecting Logitech Finding Success Through Innovation And Acquisition Case Study Solution business are high. The federal government policies relating to the publishing sector are likewise increasing with the passage of time.
Affordable.
Economic forces impacting the publishing sector in basic and the CMP in specific includesthe costs of paper, the income level of consumers, the inflation rate, and the overall GDP development of the country. All these forces combine effect the demand for the publishing market.
Social and Demographical.
Social and demographical forces consist of the population development, the consumer's choices towards reading helpful materials and so on. China has the highest population worldwide with a high population development, showing the increasing variety of consumers of the Logitech Finding Success Through Innovation And Acquisition Case Study Solution. The customer preferences are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP must focus on digital publishing to fulfill the changing customer preferences.
Technological.
Technological forces impacting the CMP include the technological development in the reading strategies etc. Enhancement of science and innovation along with the increase of digital publishing might decrease the need for the CMP products, if certain actions would not be taken soon.
Environmental.
Environmental forces affecting Logitech Finding Success Through Innovation And Acquisition Case Study Analysis includes the issues of environmental communities over the use of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink utilized while publishing should not be damaging for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. The legal guidelines relating to the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be authorized initially by the Federal government to be gone into in the publishing market. The regulation prohibits direct involvement of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's 5 Forces Model).
Porter's 5 Forces Model could be used to evaluate the attractiveness of the publishing industry China. A quick analysis of the Porter's Five Forces is provided as follows;.
Risk of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Market is moderate. The possible development in the industry tends to draw in new entrants to the publishing market. The existence of intense competitors and the requirement of big capital tends to demotivate brand-new entrants to enter in the market.
Hazard of Alternative.
Threat of Substitution is high for the Chinese Publishing Industry. The substitute items for the released documents is the documents presented in the virtual libraries on certain sites. The altering consumer preferences towards digital learning increase the hazard of replacement for the market.
Competitive Competition.
Competitive competition in the publishing market is high. The presence of large number of consumers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive competition for CMP. Together with it, new entrants are likewise participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The major providers of the Logitech Finding Success Through Innovation And Acquisition Case Study Help include the providers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the total bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of purchaser in the publishing market is high. Due to the presence of a a great deal of publishers in the Chinese market and the marketplace saturation, the buyers needs high quality files at competitive costs.
Competitors Analysis.
CMP runs in an extremely competitive industry with the existence of large number of competitors. Nevertheless, the company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Logitech Finding Success Through Innovation And Acquisition Case Study Analysis include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis one of the close competitors of CMP. Founded in the same period, CIP publishes comparable type of books. For a large period, CIP held the biggest market share, and still ranks 3rd and 2nd in various market segments, with a significant concentrate on instructional publications. CIP functions as a hazard for CMP as it might wean its market share due to its long term competitive background. CIP is focused on digital publishing and might wean the market share of Logitech Finding Success Through Innovation And Acquisition Case Study Help easily in the existing market situation.
Posts and telecommunication Press (PTP).
It was likewise established in the same duration as Logitech Finding Success Through Innovation And Acquisition Case Study Solution and CIP. It is likewise one of the prominent gamers in the publishing industry with an annual overall revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Lowering dependence over the Chinese markets.
• Increasing variety of Consumers
• Development opportunities.
• Avoiding the impact of market saturation in the Chinese publishing industry.
Cons
• Use of possible resources in growth.
• Threat of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to introduce using present abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high value to clients.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core organisation sectors to the brand-new one can lead the company to lose demand of its items in the market.
Recommendations
With the deep analysis of the external and internal environment of the business along with the industry analysis and the rival analysis, Alternative 2 is recommended to CMP to attain its future advancement. As the choices are shifting towards digital publishing and the company need an instant option to avoid the declining industry development. Therefore, introduction of digital publishing might prove to be an instant option with low amount of risk for the business. However, the company could likewise consider the expansion program after the success of its digital publishing program.
Application
In order to introduce digital publishing in its item portfolio, the business must first gathers the data associated with the consumer need, the possible markets, the government policies and the data related to the competitors presented in the market. After that, the company must decide one prospective section for its preliminary offering. It must gather research that how it could differentiate its digital publishing from the existing rivals' products. The steps above the company should go for the initial offering. The business must go for the other markets if the initial offering shows a success. In this way the business would have the ability to execute its digital publishing program.
Conclusion
The growth of the publishing market is declining given that 2008, revealing a risk to the company's long term presence, but the circumstance can be controlled by considering a development plan in the future. The business could consider introducing digital publishingin its existing market to execute its advancement program at immediate basis and to prevent the danger of failure for entrance in the brand-new markets.
