Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Solution and Analysis
Introduction
Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Solution is the biggest publishing business with a highest market share in the China's book retail market. CMP has actually ended up being a specialized information company and a big comprehensive Science and Technology publishing company through the integration of print media, audio-visual media and the network media.
Crucial Issues
Although, Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Analysis has invested its 60 years journey smoothly, being an effective publishing house, however, the altering macro market patterns and forces bring certain challenges to the publishing industry in general and CMP in particular. These elements consist of;
• Entryway of the brand-new publishing companies in the market.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Improvement of science and innovation.
The improvement of the macro markets have raised several concerns to the management at CPM that what could be the future of CMP in this circumstance? Do the long important experience, technical resources and the abilities of the business could be utilized 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
Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Analysis has certain strengths that can be made use of to lower the hazards, get rid of the weak point and get the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Solution in the publishing industry i.e. 60 years enables the business to provide high quality items at a lower cost using its prior experiences.
• The technical resources and capabilities generated by its effective journey offer a competitive advantage to CMP.
• Large item portfolioof CMP helps it to diversify its danger and supply high value to its customers.
• Strong monetary position allows the company to think about several development opportunities without any worry of raising fund externally.
Weaknesses
Along with the strengths, the business has particular weaknesses which could increase constraints for the company in implementing its advancement program. The weaknesses of Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Help are provided as follows;
• Despite of being a science and innovation publishing company, the business 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 certain expansion plans to prevent its reliance over the Chinese markets to accomplish long term growth.
Opportunities
Although, the development of the publishing industry is declining given that 2008, affecting Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Analysis as well, however the development could be restored by availing certain opportunities provided in the market. The market chances for CMP consist of;
• The company might likewise present Digital Publishing by using its long term technical experience and a strong client recognition in the market.
• CMP might think about an advancement program through the expansion towards foreign markets in order to lower its reliance over Chinese markets by using its huge financial resources.
Risks
The changing macro trends in the market and increasing competitors in the publishing market has postured certain hazards to Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Solution consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could lead to decreasing market share of Sharks In The Water Battling An Activist Investor For Corporate Control B 2 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 threat for CMP to lose its competitive position in the market, as competitors can acquire a strong consumer base by using certain methods like aggressive promo, quality products, and so on
• Entryway of new publishing companies in the industry together with presence of high competition increases the threat of losing the client base.
Financial Analysis.
Due to lack of data, the financial ratios of CMP could not be calculated. It might be analyzed from the Appendix III that the yearly total profits of Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Analysis during the period 2000-2012 are growing at a high growth rate, revealing that the annual need of the items of CMP is growing and the company is rather efficient in bring in a large number of consumers at a possible price.
Together with it, the 2nd graph which reveals the yearly development in the Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Solution overall assets, shows that the business is quite efficient in including worth to its assets through its incomes. The development in possessions shows that the total value of the firm is also increasing with increasing the total incomes. (Unidentified, 2013).
Another monetary analysis of the company utilizing the given information might be the analysis regarding the distribution of total revenues of the company. Major 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 business might move towards other organisation segments with a possible growth to accomplish its future advancement objective.
PESTEL Analysis
PESTEL analysis might be performed to discover the different external forces affecting the performance of the company and the recent trends in the external environment of the business. A quick PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a significant effect on the state of mind of the people about the communist ideology of the government, therefore, the publishing sector is highly monitored and directed by the Publicity Department of the Communist Celebration of China. It could be said that the overall political forces affecting CMP organisation are high. The federal government policies relating to the publishing sector are also increasing with the passage of time.
Economical.
Financial forces affecting the publishing sector in general and the Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Analysis in specific includesthe rates of paper, the income level of customers, the inflation rate, and the general GDP growth of the country. All these forces combine impact the demand for the publishing market. In addition to it, the economic policies related to the import of books impact the total organisation at CPM. However, China's economic conditions are rather beneficial for CMP with high GDP growth and consumer earnings level.
Social and Demographical.
The customer choices are moving towards digital publishing rather than the standard was of publishing. In this regard, CMP ought to focus on digital publishing to fulfill the changing customer choices.
Technological.
Technological forces impacting the CMP include the technological development in the reading methods and so on. Improvement of science and technology in addition to the rise of digital publishing might reduce the demand for the CMP products, if specific actions would not be taken soon.
Environmental.
Ecological forces affecting Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Help consists of the issues of environmental communities over the use of paper in publishing books. The paper utilized in the books while publishing is required to be non reusable and the ink used while publishing ought to not be hazardous for the environment.
Legal.
Legal policies 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 Ordinance 1997 needs the publishers to be authorized first by the Federal government to be entered in the publishing market. The regulation forbids direct participation of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's Five Forces Model).
Porter's Five Forces Model might be utilized to analyze the appearance of the publishing market China. A short analysis of the Porter's Five Forces is given as follows;.
Threat of New Entrants.
Dangers of new entrants in the Chinese Publishing Market is moderate. The prospective growth in the market tends to bring in brand-new entrants to the publishing industry. Nevertheless, the presence of extreme competition and the requirement of big capital tends to demotivate brand-new entrants to enter in the market.
Danger of Replacement.
Threat of Replacement is high for the Chinese Publishing Industry. The substitute products for the published files is the files presented in the virtual libraries on certain websites. The changing customer choices towards digital learning increase the hazard of substitution 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 etc. tends to produce high competitive rivalry for CMP. Together with it, brand-new entrants are also entering into the marketplace increasing the competition for CMP.
Bargaining Power of Supplier.
The significant providers of the Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Analysis consist of the suppliers of the paper for releasing files. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the total bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Negotiating 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 market saturation, the purchasers requires high quality files at competitive costs.
Rivals Analysis.
CMP runs in an extremely competitive market with the existence of a great deal 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 B 2 Case Study Help include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis one of the close competitors of CMP. Established in the exact same duration, CIP publishes similar kind of books. For a large period, CIP held the largest market share, and still ranks third and 2nd in different market segments, with a significant focus on academic publications. CIP functions as a danger 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 Sharks In The Water Battling An Activist Investor For Corporate Control B 2 Case Study Help quickly in the current market circumstance.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise founded in the same period as CMP and CIP. It ranks sixth in the state-owned publishers in terms of service scale. It is likewise among the popular gamers in the publishing industry with a yearly total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Reducing reliance over the Chinese markets.
• Increasing number of Consumers
• Growth chances.
• Avoiding the effect of market saturation in the Chinese publishing market.
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 brand-new markets.
• Easy to introduce utilizing present capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio provides high worth to consumers.
Cons
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core organisation segments to the new one can lead the business to lose need of its items in the market.
Suggestions
As the preferences are moving towards digital publishing and the company need an instant service to prevent the declining industry growth. The business might likewise consider the growth program after the success of its digital publishing program.
Execution
In order to introduce digital publishing in its item portfolio, the business needs to first gathers the data related to the customer need, the possible markets, the federal government regulations and the data related to the rivals presented in the market. After that, the business needs to choose one potential segment for its initial offering. It must collect research that how it could distinguish its digital publishing from the existing competitors' items. The actions above the business ought to go for the initial offering. The company ought to go for the other markets if the initial offering proves a success. In this method the business would be able to execute its digital publishing program.
Conclusion
Although, the development of the publishing market is declining considering that 2008, revealing a threat to the business's long term presence, but the situation can be controlled by considering an advancement plan in the future. The company might consider presenting digital publishingin its existing market to implement its development program at instant basis and to avoid the threat of failure for entryway in the brand-new markets.
