Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Solution and Analysis
Introduction
Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Analysis 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 comprehensive Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Critical Concerns
Although, Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Help has actually invested its 60 years journey efficiently, being a successful publishing house, nevertheless, the changing macro market trends and forces bring certain difficulties to the publishing industry in general and CMP in particular. These aspects consist of;
• Entryway of the new publishing firms in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Enhancement of science and innovation.
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 scenario? Do the long valuable experience, technical resources and the capabilities of the business could be made use of to pursue the future advancement unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Solution has particular strengths that can be used to lower the threats, get rid of the weakness and obtain the chances. Strengths of CMP are offered as follows;
• The long term experience of Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Solution in the publishing industry i.e. 60 years allows the company to supply high quality items at a lower expense utilizing its prior experiences.
• The technical resources and abilities produced by its effective journey offer a competitive benefit to CMP.
• Vast item portfolioof CMP helps it to diversify its threat and supply high value to its consumers.
• Strong monetary position permits the company to think about numerous development opportunities with no fear of raising fund externally.
Weaknesses
In addition to the strengths, the company has specific weaknesses which might increase restrictions for the business in implementing its development program. The weak points of Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Help are offered as follows;
• Despite of being a science and technology publishing firm, the company still has conventional ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It must propose particular growth strategies to prevent its dependence over the Chinese markets to achieve long term growth.
Opportunities
Although, the development of the publishing industry is declining because 2008, affecting Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Analysis as well, however the growth could be restored by availing particular opportunities provided in the market. The market opportunities for CMP include;
• The company might likewise introduce Digital Publishing by using its long term technical experience and a strong consumer acknowledgment in the market.
• CMP could think about a development program through the growth towards foreign markets in order to minimize its reliance over Chinese markets by using its huge financial resources.
Threats
The altering macro patterns in the market and increasing competitors in the publishing market has actually postured particular hazards to Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Analysis including;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could result in decreasing market share of Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Analysis due to the customer shift towards digital libraries.
• The presence of large number of rivals in the publishing market increase the danger for CMP to lose its competitive position in the market, as rivals can gain a strong consumer base by utilizing certain methods like aggressive promo, quality products, etc.
• Entrance of brand-new publishing companies in the industry together with existence of high competitors increases the threat of losing the consumer base.
Monetary Analysis.
The company has a rather competitive financial efficiency. Due to absence of data, the monetary ratios of CMP might not be calculated. The general monetary performance of the business could be analyzed by utilizing the charts provided in the case Appendices. It could be evaluated from the Appendix III that the annual overall earnings of CMP during the duration 2000-2012 are growing at a high growth rate, revealing that the yearly need of the products of Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Solution is growing and the business is quite efficient in attracting a large number of consumers at a potential cost.
In addition to it, the second chart which reveals the yearly growth in the Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Analysis overall assets, reveals that the company is rather effective in including value to its properties through its revenues. The development in possessions shows that the total worth of the firm is likewise increasing with increasing the total revenues. (Unidentified, 2013).
Another financial analysis of the business using the provided information might be the analysis concerning the circulation of total earnings of the business. Huge part of the earnings of CMP originates from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The business could move towards other business sectors with a possible development to accomplish its future advancement goal.
PESTEL Analysis
PESTEL analysis could be performed to find out the different external forces impacting the performance of the business and the recent patterns in the external environment of the company. A short PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial impact on the frame of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly monitored and assisted by the Promotion Department of the Communist Celebration of China. For that reason, it might be said that the overall political forces impacting Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Analysis business are high. The government policies relating to the publishing sector are likewise increasing with the passage of time.
Cost-effective.
Financial forces impacting the publishing sector in basic and the Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Help in specific includesthe costs of paper, the earnings level of consumers, the inflation rate, and the total GDP growth of the country. All these forces integrate effect the demand for the publishing market. Along with it, the financial policies related to the import of books affect the overall organisation at CPM. However, China's economic conditions are rather beneficial for CMP with high GDP development and customer income level.
Social and Demographical.
The consumer choices are moving towards digital publishing rather than the standard was of publishing. In this regard, CMP must focus on digital publishing to fulfill the changing customer choices.
Technological.
Technological forces affecting the CMP include the technological development in the reading techniques etc. Improvement of science and technology along with the rise of digital publishing could minimize the demand for the CMP items, if certain actions would not be taken quickly.
Environmental.
Ecological forces impacting Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Analysis includes the issues of ecological neighborhoods over the use of paper in publishing books. The paper utilized in the books while publishing is required to be disposable and the ink used while publishing must not be hazardous for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. The legal guidelines regarding the publishing sector is managed by the General Administration of Press and Publication. Publishing Regulation 1997 needs the publishers to be authorized initially by the Federal government to be entered in the publishing market. The ordinance forbids direct involvement of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's 5 Forces Design).
Porter's Five Forces Design might be utilized to evaluate the attractiveness of the publishing industry China. A brief analysis of the Porter's Five Forces is provided as follows;.
Threat of New Entrants.
Threats of new entrants in the Chinese Publishing Industry is moderate. The prospective growth in the industry tends to draw in new entrants to the publishing industry. The presence of intense competitors and the requirement of huge capital tends to demotivate new entrants to go into in the market.
Risk of Substitution.
Risk of Alternative is high for the Chinese Publishing Industry. The replacement items for the released documents is the documents provided in the digital libraries on certain sites. The changing customer choices towards digital learning increase the danger of alternative for the market.
Competitive Rivalry.
Competitive rivalry in the publishing industry is high. The existence of large number of customers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive rivalry for CMP. Together with it, brand-new entrants are also participating in the market increasing the competitors for CMP.
Bargaining Power of Provider.
The major providers of the Sharks In The Water Battling An Activist Investor For Corporate Control A 2 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 total bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Negotiating power of buyer in the publishing industry is high. Due to the presence 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 operates in a highly competitive market with the presence of large number of rivals. Nevertheless, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Major competitors of Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Solution include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry 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 could wean the market share of CMP quickly in the present market circumstance.
Posts and telecommunication Press (PTP).
It was also established in the same period as Sharks In The Water Battling An Activist Investor For Corporate Control A 2 Case Study Help and CIP. It is likewise one of the prominent players in the publishing market with a yearly total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Decreasing dependence over the Chinese markets.
• Increasing variety of Consumers
• Development chances.
• Avoiding the impact of market saturation in the Chinese publishing market.
Cons
• Use of possible resources in expansion.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce utilizing current capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high value to clients.
Cons
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core company sections to the brand-new one can lead the business to lose demand of its items in the market.
Recommendations
As the preferences are moving towards digital publishing and the company need an immediate service to prevent the decreasing industry growth. The business might also consider the growth program after the success of its digital publishing program.
Application
In order to present digital publishing in its product portfolio, the company ought to initially collects the information associated with the consumer demand, the possible markets, the government policies and the information connected to the competitors provided in the market. After that, the business needs to choose one prospective segment for its initial offering. It should gather research study that how it might separate its digital publishing from the existing competitors' items. The actions above the business ought to go for the initial offering. If the preliminary offering shows a success, the business ought to choose the other markets. In this way the company would be able to implement its digital publishing program.
Conclusion
The development of the publishing market is declining given that 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 instant basis and to prevent the danger of failure for entryway in the new markets.
